Hrm ignou

The Changing Social
UNIT 1 THE CHANGING SOCIAL Context and
Emerging Issues
CONTEXT AND EMERGING
ISSUES
Objectives
After completion of the unit, you should be able to:
l understand the meaning and concept of HRM;
l describe the emerging scenario of HRM;
l discuss the challenges of HRM; and
l explain the HRM position in India.

Structure
1.1 Introduction
1.2 Meaning of Human Resource Management
1.3 A New Mandate for Human Resources
1.4 Why HRM Matters Now More than Ever
1.5 The Changing Role of HRM
1.6 Managing Human Resources in the Emerging Scenario
1.7 Managing Talent : The New ‘AVATAR’of HR Manager
1.8 HRM in India
1.9 Faddism in Western Management and its Implications for Indian Managers
1.10 Guidelines for Better HRM
1.11 Summary
1.12 Self-Assessment Questions
1.13 Further Readings
Appendix 1 : Case Study

1.1 INTRODUCTION
By transformation of economic environment, the information explosion, advances in
technology and the intensly competitive global and domestic markets have created
enormous pressure on organisation to change or perish. Against this challenging
scenario, by choice or default a new era of human resource management practices and
philosophy is emerging and assuming significance in modern organisations. This unit
aims at discussing the emerging scenario of human resource management in detail and
also the position of HRM in India.

1.2 MEANING OF HUMAN RESOURCE MANAGEMENT
Human Resource Management (HRM) is a process of bringing people and
organizations together so that the goals of each are met. It is that part of the
management process which is concerned with the management of human resources in
an organization. It tries to secure the best from people by winning their wholehearted
cooperation. In short, it may be defined as the art of procuring, developing and
maintaining competent workforce to achieve the goals of an organization in an
effective and efficient manner. 5

Human Resource According to Invancevich and Glueck, “HRM is concerned with the most effective use
Management: Context, of people to achieve organizational and individual goals. It is a way of managing
Concept and Doundaries
people at work, so that they give their best to the organization.”

1.3 A NEW MANDATE FOR HUMAN RESOURCES
Should we do away with HR? In recent years, a number of people who study and
write about business – along with many who run businesses – have been debating that
question. The debate arises out of serious and widespread doubts about HR’s
contribution to organizational performance. It is often ineffective, incompetent and
costly, in a phrase, it is value sapping. Indeed, if HR were to remain configured as it
is today in many companies, the competitive forces that managers face today and will
continue to confront in the future demand organizational excellence. The efforts to
achieve such excellence – through a focus on learning, quality, teamwork and
reengineering – are driven by the way organizations get things done and how they treat
their people. Those are fundamental HR issues. Create an entirely new role and
agenda for the field that focuses it not on traditional HR activities, such as staffing
and compensation, but on outcomes HR should not be defined by what it does but by
what it delivers – results that enrich the organization’s value to customers, investors,
and employees.
More specifically, HR can help to deliver organizational excellence in the following
four ways:
l First, HR should become partner with senior and line managers in strategy
execution, helping to move planning form the conference room to the
marketplace.
l Second, it should become an expert in the way work is organized and executed,
delivering administrative efficiency to ensure that costs are reduced while quality
is maintained.
l Third, it should become a champion for employees, vigorously representing their
concerns to senior management and at the same time working to increase
employee contribution; that is employees’ commitment to the organization and
their ability to deliver results.
l And finally, HR should become an agent of continuous transformation, shaping
processes and a culture that together improve an organization’s capacity for
change.

1.4 WHY HRM MATTERS NOW MORE THAN EVER
Regardless of their industry, size or location, companies today face five critical
business challenges. Collectively, these challenges require organizations to build new
capabilities. Who is currently responsible for developing those capabilities?
everyone and no one. That vacuum is HR’s opportunity to play a leadership role in
enabling organizations to meet the following competitive challenges.
Globalization: Gone are the days when companies created products at home and
shipped them abroad “as is”. With the rapid expansion of global markets, managers
are struggling to balance the paradoxical demand to think globally and act locally.
The imperative requires them to move people, ideas, products and information around
the world to meet local needs. They must add new and important ingredients to the
mix when making strategy: volatile political situations, contentious global trade
issues, fluctuating exchange rates, and unfamiliar cultures. They must be more
literate in the ways of international customers, commerce, and competition than ever
6

before. In short, globalization requires that organizations increase their ability to The Changing Social
learn and collaborate and to manage diversity, complexity and ambiguity. Context and
Emerging Issues
Profitability Through Growth: During the past decade, most Western companies
have been clearing debris, using downsizing, reengineering, delivering and
consolidation to increase efficiency and cut costs. The gains of such yard work,
however, have largely been realized, and executives will now have to pay attention to
the other part of the profitability equation: revenue growth.
Technology: From videoconferencing to the Internet, technology has made out world
smaller and faster. Ideas and massive amounts of information are in constant
movement. The challenge for managers is to make sense and good use of what
technology offers. Not all technology adds value. But technology can and will affect
how and where work gets done. In the coming years, managers will need to figure out
how to make technology a viable, productive part of the work setting. They will need
to stay ahead of the information for business results. Otherwise, they risk being
swallowed by a tidal wave of data – not ideas.
Intellectual Capital: Knowledge has become a direct competitive advantage for
companies selling ideas and relationships (think of professional service, software and
technology-driven companies) and an indirect competitive advantage for all companies
attempting to differentiate themselves by how they service customers. Form now on,
successful companies will be the ones that are the most adept at attracting, developing,
and retaining individuals who can drive a global organization that is responsive to
both its customers and the burgeoning opportunities of technology. Thus the challenge
for organizations is making sure they have the capability to find, assimilate, develop,
compensate, and retain such talented individuals.
Change, Change and More Change: Perhaps the greatest competitive challenge
companies face is adjusting to – indeed, embracing – nonstop change. They must be
able to learn rapidly and continuously, innovate ceaselessly, and take on new strategic
imperatives faster and more comfortably. Constant change means organizations must
create a healthy discomfort with the status quo, an ability to detect emerging trends
quicker than the competition, an ability to make rapid decisions, and the agility to seek
new ways of doing business. To thrive, in other words, companies will need to be in
a never-ending state of transformation, perpetually creating fundamental, enduring
change.
The five challenges described above have one overarching implication for business:
the only competitive weapon left is organization. Sooner or later, traditional forms of
competitiveness-cost, technology, distribution, manufacturing, and product features –
can be copied. They have become table stakes. You must have them to be a player,
but they do not guarantee you will be a winner.

1.5 THE CHANGING ROLE OF HRM
In an organization, there are tall people, short people, fat people, thin people, black
people, white people, elderly people, young people and so on. Even within each
category there are enormous individual differences. Some will be intelligent, others
not so intelligent, some are committed to jobs, others are not, some will be outgoing,
others reserved and so on. “The point is that these differences demand attention so
that each person can maximize his or her potential, so that organizations can
maximize their effectiveness and so that the society as a whole can make the wisest
use of its human resources” (Cascio). The challenge of HR managers today is to
recognize talent and nurture the same carefully and achieve significant productivity
gains over a period of time. The enterprise is nothing but people. Technological
advances, globalize competition, demographic changes, the information revolution and 7

Human Resource trends toward a service society have changed the rules of the game significantly. In
Management: Context, such a scenario, organizations with similar set of resources gain competitive
advantage only through effective and efficient management of human resources
(Dessler).
The role of a HR manager is shifting from a protector and screener to the planner and
change agent. In present day competitive world, highly trained and committed
employees are often a firm’s best bet. HR professionals play a key role in planning
and implementing downsizing, restructuring and other cost-cutting activities. They
enable a firm to be more responsive to product innovations and technological changes.
For example, team based work assignments and productivity linked rewards could
replace manufacturing systems. In service enterprises like banking, hotels, insurance
firms, etc., discourteous employee responses may ruin the relationships with
customers. Employees who lack the temperament, maturity, social skills and tolerance
for frequent contact should not be selected at all for service-oriented activities. HR
professionals can help an organization select and train employees for such emerging
roles. Employees are the primary pillars of corporate success. Machines neither have
new ideas nor they can solve problems or grasp opportunities. Only people who are
involved and thinking can make a difference. Through open communications, proper
feedback and fair treatment of all employees’ grievances and discipline matters, HR
professionals promote employee commitment at various levels. In such a case
employees perform the assigned tasks willingly and enthusiastically and thus offer a
competitive advantage to the organization. As rightly pointed out by Charles Creer,
(Strategy and Human Resources, 1995), “in a growing number of organizations
human resources are now viewed as a source of competitive advantage.
……Increasingly it is being recognized that competitive advantage can be obtained
with a high quality workforce that enables organizations to compete on the lines of
market responsiveness, product and service quality, differentiated products and
technological innovation”.
In the new economy, winning will spring form organizational capabilities such as
speed, responsiveness, agility, learning capacity and employee competence.
Successful organizations will be those that are able to quickly turn strategy into
action; to manage processes intelligently and efficiently; to maximize employee
contribution and commitment; and to create the conditions of seamless change. The
need to develop those capabilities brings us back to the mandate for HR set forth at
the beginning of this article. Let’s take a closer look at each HR imperative in turn.
Becoming a Partner in Strategy Execution. Strategy is the responsibility of the
company’s executive team – of which HR is a member. To be full-fledged strategic
partners with senior management, however, HR executives should impel and guide
serious discussion of how the company should be organized to carry out its strategy.
Creating the conditions for this discussion involves four steps.
First, HR should be held responsible for defining an organizational architecture. In
other words, it should identify the underlying model of the company’s way of doing
business. Several well-established frameworks can be used in this process. Jay
Galbraith’s star model, for example, identifies five essential organizational
component: strategy, structure, rewards, processes and people. The well-known
7-S framework created by McKinsey & Company distinguishes seven components in a
company’s architecture: strategy, structure, systems, staff, style, skills and shared
values.
It’s relatively unimportant which framework the HR staff uses to define the company’s
architecture, as along as it’s robust. What matters more is that an architecture be
articulated explicitly. Without such clarity managers can become myopic about how
the company runs – and thus about what drives strategy implementation and what
8

stands in its way. They might think only of structure as the driving force behind The Changing Social
actions and decisions, and neglect systems or skills. Or they might understand the Context and
Emerging Issues
company primarily in terms of its values and pay inadequate attention to the influence
of systems on how work – that is, strategy execution – actually gets accomplished.
In India, the borderless world is shaking the roots of business. While some companies
are feeling the excitement and facing up to the challenges, the demand for a tilted
playing field6 indicates the anxiety among many Indian business leaders about
competition. Increasingly, the mantra of the global economy is performance and
competition.

1.6 MANAGING HUMAN RESOURCES IN THE
EMERGING SCENARIO
The 21st century would see the following inter-related phenomena emerging, posing
challenges to the corporate world and culminating in Olympian competition:
l Borderless world
l Diversity
l Knowledge Power
The cross-cultural, cross-border mingling has resulted in the creation of a new class of
people—global citizens with global attitudes, tastes and networks. Since it unleashes
multiple variables, the borderless world precludes immense complexity—complexity
in the environment, in inter-organizational relationships, in modes of conducting
business and in socio-cultural diversity.
One of the important duties of the modern HR manager is to get things done through
people. He has to bring employees into contact with the organization in such a way
that the objectives of both groups are achieved. He must be interested in the people,
the work and the achievement of assigned objectives. To be effective, he must balance
his concerns for people and work. In other words, he must know how to utilize human
as well as non-human resources while translating goals into action. It is in managing
human assets that the manager’s capabilities are tested fully, because of the following
reasons:
l Human resources are heterogeneous. They consist of many different individuals,
each of whom has a unique personality, a combination of different emotional
responses to different stimuli and different values, attitudes, motives and modes
of thought.
l Human beings behave in widely different and complicated ways. Their reactions
to promises, praise or criticism, for example, can be quite different. It is very
difficult to predict their behaviour especially in an organization where they work
in-groups. Their behaviour is neither consistent nor readily predictable.
l Modern employees are better educated, possess greater skills, have more
sophisticated technology available for their use and enjoy higher standards of
living than previous generations.
l A human being himself determines what he contributes. If he is motivated, he
will work for an organization more efficiently and effectively.
So, it must be recognized by the manager that individuals, not organizations, create
excellence. Recognizing the importance of the human element in the production
process, PF Drucker had remarked that “man, of all the resources available to man,
can grow and develop”. The problem of establishing the right climate to maximize
employee motivation and commitment is still with us.
9

Human Resource The Challenge of Human Resource Management
Management: Context,
Concept and Doundaries The most significant resource of any organization is often said to be its people. Such
claims appear in organizations’ annual reports and mission statements. Of course, an
organization is nothing but a group of people whose activities have been planned and
coordinated to meet organizational objectives. An organization that exists to produce
goods and services has a good chance to survive and prosper if it consists of the Right
People. This is true for all organizations. In a similar fashion, people need
organizations. The vast majority of people must work to support themselves and their
families. But people work for many reasons other than economic security. For
example, many also work to keep busy and feel useful, to create and achieve
something. They want to gain recognition and achieve status or to test and stretch
their capabilities. To meet these multifarious needs, people and organizations join
forces. Unfortunately, this union seldom approaches perfection. Organizations
encounter several obstacles in meeting their goals and in a similar way all employees
report some problems in their attempts to be productive and efficient in their jobs and
to feel satisfied in their work lives. The challenge of human resource management is
to minimize these obstacles and problems.
The central challenge facing society is the continued improvement of our
organizations, both private and public. Another important purpose of human resource
management is to improve the contribution made by people to organizations, (Davis)
through effective and efficient use of resources. Efficient means that it must use the
minimum amount of resources needed to produce results. Effective means producing
right things through right ways. The resultant productivity (ratio of output to input)
gains obtained through HR efforts enable managers to reduce costs, save scarce
resources, enhance profits and offer better pay, benefits and working conditions to
employees.
l Pervasive force : HRM is pervasive in nature. It is present in all enterprises. It
permeates all levels of management in an organization.
l Action oriented : HRM focuses attention an action, rather than on record
keeping, written procedures or rules. The problems of employees at work are
solved through rational policies.
l Individually oriented : It tries to help employees develop their potential fully.
It encourages them to give out their best to the organization. It motivates
employees through systematic process of recruitment, selection, training and
development coupled with fair wage policies.
l People oriented : HRM is all about people at work, both as individuals and
groups. It tries to put people on assigned jobs in order to produce good results.
The resultant gains are used to reward people and motivate them toward further
improvements in productivity.
l Development oriented : HRM intends to develop the full potential of
employees. The reward structure is tuned to the needs of employees. Training is
offered to sharpen and improve their skills. Employees are rotated on various
jobs so that they gain experience and exposure. Every attempt is made to use
their talents fully in the service of organizational goals.
l Integrating mechanism : HRM tries to build and maintain cordial relations
between people working at various levels in the organization. In short, it tries to
integrate human assets in the best possible manner in the service of an
organization.
l Comprehensive function : HRM is, to some extent, concerned with any
organizational decision which has an impact on the, workforce or the potential
1 0
workforce (Bernardin). The term ‘workforce’ signifies people working at

various levels, including workers, supervisors, middle and top managers. It is The Changing Social
concerned with managing people at work. It covers all types of personnel. Context and
Emerging Issues
Personnel work may take different shapes and forms at each level in the
organizational hierarchy but the basic objective of achieving organizational
effectiveness through effective and efficient utilization of human resources,
remains the same. “It is basically a method of developing potentialities of
employees so that they get maximum satisfaction out of their work and give their
best efforts to the organization” (Pigors and Myers).
l Auxiliary service : HR departments exist to assist and advise the line or
operating managers to do their personnel work more effectively. HR manager is
a specialist advisor. It is a staff function.
l Inter-disciplinary function : HRM is a multi-disciplinary activity, utilizing
knowledge and inputs drawn from psychology, sociology, anthropology,
economics, etc. To unravel the mystery surrounding the human brain, managers,
need to understand the appreciate the contributions of all such ‘soft ‘disciplines.
l Continuous function : According to Terry, HRM is not a one short deal. It
cannot be practiced only one hour each day or one day a week. It requires a
constant alertness and awareness of human relations and their importance in
every day operations.

1.7 MANAGING TALENT: THE NEW ‘AVATAR’ OF HR
MANAGER

Human relation movement was the turning point in the management field that changed
the thinking in the field of management. After the Mayo’s work on human relation the
human being has become a central point in the organization. Man as a resource now is
being treated as a human being and not as machine. After that several other
management thinkers also contributed a lot that how we can motivate, attract and
retain people in an organization. Work of Marry Parker Follet, Maslow, Herzberg,
Vroom, and Macgregor are invaluable in this field. The result of all these theories is
the evolution of a new field called Human Resource Management.
The functions of HRM include human resource planning, recruitment, selection,
placement, and orientation of employees; training and career development; labour
relations; management of performance appraisal, compensation, and benefit
programmes and development of personnel policies and procedures. The issue has
been brought into sharper focus over the past few years by the concept of the “war for
talent” and, more recently, new proposals or reporting on human capital management.
There are three fundamental forces fuelling the war for talent: the irreversible shift
from the Industrial Age to the Information Age, the intensifying demand for high-
calibre managerial talent, and the growing propensity for people to switch from one
company to another. Because of above mentioned environment and its impact on
organization, it forces us to give emphasis on understanding the talent management,
what type of challenges it create for HRM and what role human resource management
should play in managing the talented people. The paper starts with highlighting new
vistas of talent management, and then moves on to discuss the new avatar of the HR
manager as talent manager, in the next section various strategies used for attracting
and retaining talent have been outlined.

Talent Management: New Vistas
Talent management is a subject that has dominated HR thinking for years, variously
described as manpower-planning modeling, succession planning or high-flyer 1 1

Human Resource identification. As a consequence we have heard the emergence of “talent managers”
Management: Context, within many organizations.
So, what is talent? A definition could be: “An identifiable ability that is perceived to
add immediate or future value to any prescribed activity, discipline or
enterprise”(Maurice, 2003). Identified talent normally requires an investment of
resource to realize its value and a disciplined organizational mindset prepared to wait
for the investment to pay off. As a result, an effective talent-management system or
process is both essential for securing competitive advantage and to produce quick results.
Talent management is a core element of human capital management. People generate
capital for an organization through their competence, their behaviours and their
intellectual energy. In a commercial world increasingly dominated by knowledge-
intensive organizations, the latter is an ever-more important requirement for
competitive success. Intellectual energy is about innovation and change, about new
thinking and about opportunities developed from problems.
Talent management is primarily about identifying, developing and using those people
who can provide those critical intellectual-energy ingredients. In general, from a
successful talent-management system we expect: sustainable commercial
competitiveness; higher levels of focused innovation; improved staff engagement and
commitment, low turnover rates of knowledge and experience, lower external
resourcing costs.
After the above analysis we can say that talent management has now become a more
challenging job for an organization. This is also very clear that managing employees
in any organization is a job of Human Resource Department. But as time passes and
with reference to above referring environment now there are more opportunities for
talented people in today’s world. So because of all these it is very difficult to manage
them with traditional human resource practices, we have to do more than that
otherwise we will lose them, and in this competitive and fast changing environment we
will not survive at all. All these forces are new challenges before the Human Resource
Management.
One of HR’s most challenging jobs now involves managing talent. Much has
changed in recent years to make this an increasingly critical area for HR. Among the
issues that have made the talent management job more difficult are: frequent
restructuring, a growing reliance on outside hiring, flatter organizations with fewer
growth options, a tighter job market (at least in the long term), the aging workforce
and the decline of clear career paths, as we mentioned above that it create a big
challenge before the HR.
In order to retain its most valuable stakeholders, an organization must find innovative
ways to continually recruit its own employees. How well do you know and understand
your current employees growth path? Are your employees looking outside your
company for advancement opportunities? Retaining top quality talent is an enormous
challenge facing corporations today and it is duty of HR to cope with it. In order to
build effective retention and deployment strategies, companies must maintain visibility
into and communication with their employees.
An organization’s capacity to hire, develop and retain talent is the most crucial
business process as there is a definite correlation between intangible assets and market
capitalization, according to the protagonists of talent management. It is due to these
intrinsic intangible values that some companies are perceived as more valuable than
others. Infosys (Sachdeva, 2002), for example, is perceived as being worth fifty times
the value of its recorded assets.
Talent research company Kenexa paints a worrying picture of HR’s ability to be on
1 2 top of its game when it comes to talent management. Ninety per cent of the 22 HR

professionals polled strongly agree that recruiting talented people is a key issue, and The Changing Social
93 per cent feel the same way about retention. Yet 57 per cent of companies have no Context and
Emerging Issues
specific talent management strategy, and just 37 per cent employees someone whose
specific remit is to manage talent (Paton, 2002).
For HR professionals, this sets a challenge. On one hand, effective talent management
is an important feather in the cap of any HR manager. On the other hand, identifying,
grooming and retaining talent is a notoriously nebulous business. Human Resources
Department has an important part to play in providing the backbone for talent
management. So at the end we can say that managing the talent means find, develop
and keep the people who keep you in business is the most challengeable job of today’s
HR department in any organization.

1.8 HRM IN INDIA

The Dynamics of Personnel/Human Resource Management (P/HRM)
P/HRM (both terms used interchangeably) is a dynamic discipline as it mostly deals
with ever-changing work settings, characterized by people having varied cultural,
social and religious backgrounds, diverse goals, multifarious expectations and
attitudes. The personnel scene itself has been changing quite dramatically over the
years. Government regulations, competitive pressures, unionization of employees, do
exert a strong influence on the way the personnel function is carried out in various
organizations. Further, the nature of the work goals, make-up of the workgroup, in
the long run. Over the years, employees have become more sophisticated in their
demands for high quality work environments, adequate pay and benefits, proper
training and career growth opportunities. All these factors compel human resource
professionals to look for ways to improve their interactions with employees, other
managers and outside groups in order to maximize worker productivity and
satisfaction. However, as pointed out by Rudrabasavaraj, personnel administration in
India, as it is interpreted, discussed and practiced is largely static, legalistic and
ritualistic. There seems to be a lot of confused thinking and a plain lack of awareness
of what P / HRM is.

Changing Role of Human Resource in View of Social Factors
A number of environmental factors influence the work of a HR manager. He cannot
perform his job in a vacuum. These factors (Table 1) influence the organization
through human resources. The term ‘environment’ here refers to the “totality of all
factors which influence both the organization and personnel sub-system”.

Table 1: External and Internal Factors influencing the P/HRM Function

External Factors Internal Factors
l Technological factors l Mission
l Economic challenges l Policies
l Political factors l Organizational culture
l Social factors l Organization structure
l Local and Governmental issues l HR systems
l Unions
l Employers’ demands
l Workforce diversity
1 3

Human Resource The external environment consists of those factors which affect an organization’s
Management: Context, human resources from outside the organization. Each of these external factors
separately or in combination can influence the HR function of any organization. The
job of a HR manager is to balance the demands and expectations of the external
groups with the internal requirements and achieve the assigned goals in an efficient
and effective manner. Likewise, the internal environment also affects the job of a HR
manager. The functional areas, structural changes, specific cultural issues peculiar to
a unit, HR systems, corporate policies and a lot of other factors influence the way the
HR function is carried out. The HR manager has to work closely with these
constituent parts, understand the internal dynamics properly and devise ways and
means to survive and progress. In addition to these, the personnel man has to grapple
with the problem of workforce diversity. Let us examine these issues in detail.

Social Factors
HR managers have long realized the importance of conducting their business in a
socially relevant and responsible manner. What do you do when the company operates
in an area where large army of unemployed people live? A philosophy of hiring
workers who are capable of being trained as against hiring only qualified applicants
may help reduce unemployment. It may also improve profitability in the long run. Is it
possible for a person to buy a firm’s products or services if he remains unemployed?
The society at large nowadays is more demanding. The actions of business are being
monitored and evaluated closely. If a manufacturer claims that his product has one
hundred per cent juice content (e.g., Onjus) and the rival (Tropicana) tries to contest
this issue openly, the customer is ready to evaluate the issue dispassionately and
decide about the future course of action. If the expectations are not met or the tall
claims do not stand the test, the fate of the firm/brand is automatically sealed (as it
happened in the case of Bajaj’s motor cycle, ‘Cheetah’, technologically-outdated
Ambassador car model, etc.). Firms do not operate in isolation. They are stuck with
society. Social impacts have to be carefully evaluated before undertaking any action
programme. And society here includes the firms’ own employees and their friends,
relations, neighbours as well. Before cutting jobs in a big way (where, for example, in
National Textile Corporation 40,000 jobs have been slashed voluntarily), HR
managers have to assess reactions beforehand and come out with certai11 proactive
steps (explain facts, train or retrain them, give outplacement help, etc.). Considerable
pressure can be exerted on a firm to alter its practices (for example, in Steel Authority
of India, SBI and other State owned Banks, DTC the slashing of jobs did not take
place in a big way) if the public believes that it is not operating in the best interests of
society. A firm, after all, operates by public consent to satisfy society’s needs.

Local and Governmental Factors
Governments all over the world had neither the time nor the interest to care for the
problems pertaining to labour arising in industry till the end of 19405. But the need
for Governmental interference arose out of the belief that Government is the custodian
of industrial and economic activities. The emergence of problems on the industrial
front in the form of trade union movement, failure of many employers to deal fairly
with workers, non-fulfillment of plan targets and the like, forced the governments to
intervene in human resource management and to enact various pieces of labour
legislation. Consequently, the Government in India, too, has come out with a complex
set of rules and regulations on the employment policy of the organizations by
reserving certain number of jobs of all categories to certain sections of the community.
Hence, the management cannot manage the personnel unilaterally as it used to do,
because it has to abide by the rules and regulations imposed by the Government from
time to time.
1 4

One of the most important external factors that affects HRM is the legal environment, The Changing Social
i.e., awareness of legislations enacted by the government at the Centre and the States. Context and
Emerging Issues
The important legislations enacted in India affecting HRM are: Factories Act, 1948;
Trade Unions Act, 1926; The Payment of Wages Act, 1936; The Minimum Wages
Act, 1948; The Employment State Insurance Act, 1948; Workmen’s Compensation
Act, 1923; The Payment of Bonus Act, 1965; The Industrial Employment (Standing
Orders) Act, 1946; The Employment Exchange (Compulsory Notification of
Vacancies) Act, 1959; Payment of Gratuity Act, 1972; the Maternity Benefit Act,
1961; The Apprentice Act,1961; etc.

Unions
Unions have also gained strength after the advent of Industrial Revolution. At present,
these organizations constitute one of the power blocks in many countries, including
India. With the formation and recognition of these organizations, the issues relating to
employee interests are no longer determined by the unilateral actions of management.
These have to be discussed with union representatives invariably. In addition, unions
have shifted their emphasis from economic tactics to the political pressures. Thus “.
...the unions have turned increasingly to governmental action as a means of achieving
their objectives in addition to using the more traditional actions”. In consequence, the
scope of managerial discretion in personnel activities has been narrowed down.

Workforce Diversity
Diversity in the field of HRM can be defined as the situation that arises when
employees differ from each other in terms of age, gender, ethnicity, education, etc.
Workforce diversity means that organizations are becoming more heterogeneous in
terms of age gender, race, ethnicity.
The composition of the workforce is changing in India (Teble 2). Young, skilled and
knowledgeable employees are occupying positions of importance. At the same time,
thanks to the opening up of private sector, employees are no more fascinated by
secure, less-paying, routine and standardized jobs offered by the public sector and
other government-owned and controlled organizations. Old employees have grown in
number now, thanks to the improved medical and health care. Big private sector firms
have been exploiting their talents to conceive, operate and develop new ventures in
emerging areas such as oil, telecom, insurance, banking, health care, etc.

Table 2: Young vs Old Workforce

Young Old
l Inexperienced l Difficult
l Impulsive l Traditional
l Inpatient l Go by the rule book
l Unethical / Not always ethically conscious l Workaholic
l Selfish l Inflexible
l Manipulative l Prefer safe, steady work
environments, less risky
activities

Organizations now cannot discriminate on the basis of age. They must listen to their
experienced employees, to draw from their expertise and initiate programmes that
meet these needs. At the same time companies have to understand and appreciate the
changing values of the young workers who join the company with lot of expectations.
The days of life time employment, total loyalty to company anl1 commitment to work
seem to be a thing of the past. To attract and retain young brains, organizations have
to institute appropriate HR policies, supported by attractive compensation offers.
1 5

Human Resource Diversity issues in Indian companies are somewhat peculiar owing to differences in
Management: Context, social ethos, religious origins, cultural differences and regional origins. Certain
sections of society enjoy a preferential treatment, guaranteed by constitution, right at
the entry level itself shown in the following Table.

Table 3: Minority Groups, Reserved Category Employees in India

Scheduled costs and scheduled tribes (SCs & STs)
Other backward castes (OBCs)
Sans of the soil
Ex-Defence and Para-military personnel
Physically disabled
Displaced persons (DPs)
Gender issues
Contract labour
Child labour

The job reservation for SCs and STs have been extended for another 10 years, starting
from 2,000 tl1rough a recent government notification, in all public sector
undertakings. The list of OBCs has also been expanded now by the Vajpayee-led BJP
government, to extend employment benefits to other neglected sections of society. The
sons of the soil policy ensures reservation of certain category of lower level jobs to
local people in preference to outsiders. Shiv Sena, for example, is a strong supporter
of this policy ever since its inception as a political party in Maharashtra. Displaced
persons too get preferential treatment for lower level positions advertised by the
company which has acquired their land/house sites, etc. (Essar Steel, Reliance, etc.),
for building factories/production facilities. In addition, HR managers have to deal
with issues of child labour (a sensitive issue in industries such as carpet making,
crackers industry, etc.) and contract labour where the various pieces of labour
legislation are being conveniently ignored by the employers.

Women at Work
Women employees today constitute a major share of the workforce. In India alone
over 400 million are employed in various streams due to a combination of factors like:
l Women’s emancipation
l Growing economic needs
l Greater equality of sexes
l Increased literacy rate
l Suitability for certain soft jobs (public relations, telephone reception
counters, etc.). (Praxis, Women in Management, 1999)
Exhibit 1: The Invisible Workforce

Women hold up more than half the sky. Far from being just a vigorously uttered slogan,
government studies reveal that the female workforce in India does indeed make a
significant contribution to the nation’s economy and family welfare. Yet, at the same
time, this economic contribution is either abjectly unrecognized or where taken note of, is
qualitatively unprotected. According to 1981 census, 89.5 per cent of women workers are
engaged in the unorganized sector, of which a huge chunk -82.3 per cent -actively
participate in agricultural and allied operations. This massive segment of the female
workforce contributes as much as 60-70 per cent to total agricultural activity in our
village.
–Business India, March 6 to 19. Special Feature.
1 6

The initial reluctance of employers to give jobs to women seems to be a thing of the The Changing Social
past (due to increased financial burden in the form of maternity benefits, creches, Context and
Emerging Issues
prohibition of women in night shifts and in hazardous jobs, etc.). They handle both
‘hard’ and ‘soft’ jobs now in areas such as accounting, hospitality, banking,
insurance, airways, police, teaching, beauty care and even driving. The principle of
equal pay for equal work has more or less become the rule now in most industries
(barring plantation, construction industry, etc.).
Organizational workforce thus consists of people from different regions, mostly due to
increased transportation facilities and the mobile character of people. Further,
technological revolution has brought about occupational mobility. These changes in
workforce have naturally complicated the task of HRM as the HR manager, has to
grapple with employees with vastly different backgrounds.

Changes in Employee Roles and their Values
Traditionally, it was believed that management has got the brains and hence will
decide what is good or bad for the employees. The employees are expected to follow
the commands of the boss without posing any questions. However, this paternalistic
atmosphere has changed with the advent of unions. Employers have also gained
consciousness regarding their rights in the workplace.
Further, the changing structure of the workforce has led to the introduction of new
values in organizations
Exhibit 2: Changing Work Values

In our increasingly complex society, people have more educational and developmental
opportunities than ever. This in turn has helped create a whole new set of employee
expectations.
As a result, the traditional employee and the contemporary employee tend to hold
markedly different attitudes toward work and authority. Organizations must now advance
from general affirmation and enthusiasm for the career development of their personnel to
greater precision. The concepts and goals of education and development programmes
must be more precise, more widely understood, reflected in formal policy statements and
translated into institutional and personnel practice.
– Jack Halloran, Personnel and HRM, Prentice Hall, NJ, 1986.

These are moving towards (a) emphasis on quality of life rather than quantity; (b)
equity and justice for the employees over economic efficiency; (c) pluralism and
diversity over uniformity and centralism; (d) participation over authority; (e) personal
convictions over dogma; and (f) the individual over the organization. Alienation from
the job, increasing counter-productive behaviour, rising expectations and changing
ideas of employees are some of the other factors responsible for the changing values
and roles of human force. Consequently, it has become imperative for the management
to include various fringe benefits to improve morale, introduce a machinery to redress
grievances, encourage employee participation in decision-making and the like to pave
the way for industrial betterment and to meet the ever increasing demands of
workforce.
Another change in the values of employees is the declining work ethic. In the days
gone by employees regarded job as a central life interest and pursued work
assignments with single-minded devotion. In recent years, the work ethic has declined
in favour of a more existential view of life. Work is regarded as only one alternative
among many as a means for becoming a whole person in order to do one’s own thing.
Family activities, leisure, avocations and assignments in government and schools are
all equally viable means through which a person can find meaning and become self-
actualized. 1 7

Human Resource Further, employees are seeking a greater balance between their work lives and their
Management: Context, personal lives, more leisure time and greater flexibility in scheduling time away from
work especially in 80s, Feeling severely constrained by the Monday-through-Friday,
nine-to-five grueling routine, they find it difficult to schedule doctors’ appointments,
accommodate children’s school schedules and satisfy other personal needs away from
work. Employees are demanding that management look more closely at work
schedules which accommodate their needs in addition to the needs of the company.

Level of Education
Workers have been entering the organizations with increased level of formal education
in recent years. Increased formal education led to the changes in attitudes of
employees. The well-educated employees always challenge and question the
management’s decisions and want a voice in the company’s affairs affecting their
interests. “As the base of education broadens, management must plan to deal with
employees on a higher plane of logical interactions”. One implication of an increase in
educated and knowledge workers-accountants, engineers, social workers, nurses,
computer experts, teachers, researchers, managers is that HRM will be called upon to
find innovative ways of keeping these people challenged and satisfied. Knowledge
workers often demand more responsibility and autonomy than their employers are
willing or able to afford.

1.9 FADDISM IN WESTERN MANAGEMENT AND ITS
IMPLICATIONS FOR INDIAN MANAGERS
Though there are number of management theories emerging every now and then, they
remain as fads and die in short span of time. The proliferation of management theories
and prescriptions are driven by two human instincts. (1) A greed to make fast bucks
(2) Fear of becoming bankrupt (Micklethwait and Woodridge, 1996).
Practitioners are influenced more by management writings in the popular or business
press rather than objective analysis of the “fads”. For example, Total Quality
Management (TQM) was one of the themes, which captured the interest of
practitioners and became a Mantra of the fashionable business managers and the
management institutes in the 80’s and the 90’s. Today even TQM is considered
passive by many practicing managers.
Another recent fad has been the “Business Process Re-engineering” which according
to some is resurrection of F W Taylor’s Scientific Management. However, there is a
backlash against “Re-engineering” as some consider that it ignores the human side of
the organization.
Another fad relates to the terminology of managing people in organizations. The
Western Management professionals, specially the American, are unable to decide
about the nomenclature for the Management of people. They went on changing from
Labour Management to Personnel Management, Human Resource Management
(HRM), Human Resource Development (HRD), Human Potential Development and
the latest fad is that separate Human Resource (HR) function in an organization itself
is redundant and same could be outsourced. The Asian, especially the Indian
organizations and the management institutes also are not far behind in moving with
these fads.
Thus, when the Western management itself is passing through a confused stage of
evolutionary process and does not find many of its fads workable, transplanting the
same to developing country like India - where environment, values and historical

1 8

background are quite different - results in further confusion leading to “dualism” in The Changing Social
Indian management (Virmani and Guptan, 1991; Virmani, 2000). This dualism gets Context and
Emerging Issues
reflected in wide gap between stated policies and practices and actual policies
followed in reality, though often denied formally. This dualism eventually results in
conflict as the management blames the employees for not allowing them to follow the
“modern” concepts of management, while the employees blame the management for
being “hypocritical” i.e. not following what they preach.
jobs now involves managing talent. Much has changed in recent years to make this an
increasingly critical area for HR. Among the issues that have made the talent
management job more difficult are: frequent restructuring, a growing reliance on
outside hiring, flatter organizations with fewer growth options, a tighter job market (at
least in the long term), the aging workforce and the decline of clear career paths, as
we mentioned above that it create a big challenge before the HR.
In order to retain its most valuable stakeholders, an organization must find innovative
ways to continually recruit its own employees. How well do you know and understand
your current employees growth path? Are your employees looking outside your
company for advancement opportunities? Retaining top quality talent is an enormous
challenge facing corporations today and it is duty of HR to cope with it. In order to
build effective retention and deployment strategies, companies must maintain visibility
into and communication with their employees.
An organization’s capacity to hire, develop and retain talent is the most crucial
business process as there is a definite correlation between intangible assets and market
capitalization, according to the protagonists of talent management. It is due to these
intrinsic intangible values that some companies are perceived as more valuable than
others. Infosys (Sachdeva, 2002), for example, is perceived as being worth fifty times
the value of its recorded assets.
Talent research company Kenexa paints a worrying picture of HR’s ability to be on
top of its game when it comes to talent management. Ninety per cent of the 22 HR
professionals polled strongly agree that recruiting talented people is a key issue, and
93 per cent feel the same way about retention. Yet 57 per cent of companies have no
specific talent management strategy, and just 37 per cent employees someone whose
specific remit is to manage talent (Paton, 2002).
For HR professionals, this sets a challenge. On one hand, effective talent management
is an important feather in the cap of any HR manager. On the other hand, identifying,
grooming and retaining talent is a notoriously nebulous business. Human Resources
department has an important part to play in providing the backbone for talent
management. So at the end we can say that managing the talent means find, develop
and keep the people who keep you in business is the most challengeable job of today’s
HR department in any organization.
Challenging work environments and the opportunity to gain diverse job
experience motivate high quality employees. These employees want to participate in
the decisions impacting their role within the organization. Give employees control over
their career paths by allowing them to submit their own profiles and skill sets.
Companies can continue to engage employees and provide internal candidates with a
mechanism to manage their individual employment experience within the organization.
Presenting employees with avenues for growth and advancement increases their
loyalty to the organization and reaffirms the company’s commitment to
their employees.

1 9

Human Resource
Management: Context, 1.10 GUIDELINES FOR BETTER HRM
Following are few guidelines for better HRM.

a) Develop People
Smart employers know that helping employees to manage their career progress will
help them to keep good people. Now more employees are asking ‘what can you do for
me’, particularly when they see there peers being provided with development
opportunities by their employers. You create opportunities for employees, then
definitely they will work hard for you otherwise not. J.Sterling Livingston rightly
observed and explained the vital role that managers play in developing their
subordinates: “Although most executives have not yet diagnosed the problem,
industry’s greatest challenge by far is to rectify the under-development, under-
utilization and ineffective management and use of its most valuable resource- its
young managerial and professional talent” (Livingston, 1988). So now ‘what the
organization is doing for me’ is becoming more important. Now every employee wants
that company should give them or send them to different training and development
programmes for his/her career developments and have to arrange and give
opportunities to employees for all these.
One solution has been to implement a company-wide project on internal
candidates and interviewing them. Interviews have been made more formal,
explaining the reasons behind them and using competency evidence for not only the
role, but also for training and development too. In the past, people were often
promoted rapidly into roles and moved about the company at will. Now, though,
there needs to be a reassessment and a recognition that, as well as moving people
about, you need to give them skills and tools to do the job they are currently doing
well even better.

b) Grooming Future Talent
While analytical and communication skills and boosted confidence will often give
graduates an edge, HR across the board is rapidly moving away from the perception
that a degree is a mandatory springboard to greater things, Murphy reckons. “There
are people who do not go to university for some very good reasons. It is our job to
provide tools to allow them to do the job” (Reckons, 2002). In this context training
needs analysis and plotting of career growth paths for employees are important
activity of HR professionals. Instead of conducting it as an annual ritual, the need
analysis should really contribute towards the skill enhancement of the employees
resulting in the fulfillment of current and future organizational requirements.

c) Employees Deployment
As employees move easily between diverse roles, the value of the internal talent
market increases because employees are armed with transferable skills and knowledge
that can be applied in many areas of the organization. This allows companies to
become more agile and to rapidly deploy workers to new projects or locations. This
deployment is very useful for employees also because now every employee wants to
become a multi skill person, because now your one skill can become meaningless any
time. So if you have given chance to them for all these than that inspires and motives a
lot to any employee. Now this is the duty of organizations that you move for all these
so that you can retain employees in your organization.

2 0

d) Build Employee Communities The Changing Social
Context and
Organizations should build high quality internal talent communities through Emerging Issues
segmentation. This enables employers to cultivate relationships with employees on the
employee’s terms and to consistently demonstrate value to the employee through
opportunities for internal mobility. This increases job satisfaction and leads to higher
retention rates. Any recruitment opportunity in the organization should be viewed as a
career growth opportunity for the existing employees without compromising efficiency
requirements. This always is very cost effective in all respects and will go a long way
in boosting the morale of existing employees. The direct correlation of morale and
higher productivity could be sufficient for any justification required for these moves
when it comes to confronting with the top management.

e) Turn Managers into Coaches
Now time has come that every employee wants to become 24 carrot gold for his future
safety point of view. When a person joins just after his getting degree of MBA, he is
totally zero from the point of view of experience. This demands that intelligent but
non-experienced need a personal coach for their perfection in the job and to cope-up
with early entry-level problem. Personal coaches are personal advocates for their
clients, but advocacy is aimed at the client. What great personal coaches are great at
is helping people help themselves. They offer penetrating insight to people about
themselves. They give them good and bad news. They help people believe that they
can do better. They give people concrete solution to help them improve. And coaches
are right there with the people they coach, encourage them, scolding them when
necessary, praising them when it’s appropriate, and constantly helping their clients
move in the right direction.
So implementation of this system in the organization is a duty of HR department with
the help of top management. From this system we can motivate and inspire the people
to do extraordinary work. Coaching style of management is the single greatest factor
in improving productivity, moral, and retention. Day to day coaching creates the kind
of trust and confidence, the genuine bond between managers and individual
contribution that cuts through everything.

1.11 SUMMARY
HRM should take on responsibility for elder care, long-term security/care, and other
social needs through cafeteria-style benefits programmes, which are crucial for talent
retention in organizations. These benefit packages allow people to identify their own
needs and custom design their own benefits. Employees find such programmes
attractive because they empower the individual to maximize the value of the benefits
an employer offers. For HR, these plans are comparatively easy to set up and, once in
place, there is virtually no additional administration involved. Winning the war for
talent requires winning the hearts of employees and their families, for which,
organizations need to go one step ahead of their competitors in winning the hearts of
their families.
Every leading organization is looking at developing their employees into balanced
human beings in order to make them use their real potential, and that offer a new set
of opportunities to HR in those organizations. Greater level of involvement of HR
people in the day-to-day life of employees is becoming the norm of the day for
companies, which are looking for greater commitment from employees. An increasing
trend is visible among the young professionals in recent years, by way of giving more
and more emphasis on family and life’s interests, and at several occasions it acts as a
2 1

Human Resource critical factor for employment decisions as well. Increasing instances of talent
Management: Context, wedding talent, lead to either of the spouse working from home providing financial
support to the family and thus giving more flexibility to the other person in selecting
organizations that provide increased work flexibility. When it comes to occasions of
personal realignments, HR has to work as a good friend in need.

1.12 SELF ASSESSMENT QUESTIONS
1) Write a comprehension on the emerging dimensions of HRM.
2) Discuss the challenges associated in the HRM in present business scenario.
3) Describe the guidelines for better HRM.

1.13 FURTHER READINGS
Challenges for Human Resources in Changing Scenario, Dr Pritam Singh and
Dr Asha Bhandarkar, Research Paper, 33rd World FTDO Conference, New Delhi,
2004.
Effective Human Resource T& D Strategies, Dr B Rathan Reddy, Himalaya
Publishers, 2004.
Management of Human Resouces, Dr T V Rao, 33rd world FTDO Conference, New
Delhi, 2004.
Personnel and Human Resource Management, A.M. Sarma, Himalaya Publishing,
1998.

2 2

Appendix 1: CASE STUDY The Changing Social
Context and
Emerging Issues
Government Regulation
Since the 1940s the Indian Government has increased its regulation of the way
employers treat employees. The Trade Union Act, 1926, permits workers to join
unions, the Minimum Wages Act, 1948, guarantees a minimum wage, the Factories
Act, 1948, ensures a safe and healthy environment, the Workmen’s Compensation Act,
1923, offers compensation to injured workers, the Payment of Wages Act, 1936,
checks fraudulent practices in the payment of wages to workers. The regulatory
framework covering factories, union-management relations, compensation issues,
dispute settlement, etc., is quite rigorous and elaborate. There are laws that prohibit
discrimination and restrict the freedom of employers to make HR decisions in other
areas as well.
As the guardian of the economy and as a regulator of employment relations, the
Central Government does not seem to loosen its grip in the near future. Experts
believe that the trend toward increased governmental intervention will continue. They
base their arguments on the current trends in developed countries in this area in the
form of employer-sponsored health insurance schemes, greater job security, improved
treatment, etc.
Others, however, are not very optimistic about governments trying to regulate the
employer-employee relations closely. Competitive pressures, deregulation of industry,
rising wage bills, increasing number of older employees needing social security
protection, inflationary pressures, heavy taxes and a host of other factors having a
significant bearing on the profitability of a firm do not seem to support government’s
active intervention in industry. These experts contend that if Indian firms have to
remain competitive in international markets, they should be freed from all types of
control, especially those imposed by the government.

Questions
1) Which trend do you think will occur and why?
2) If government regulation continues to increase, how will HR departments be
affected?

2 3

Human Resource
UNIT 2 THE CONCEPT AND FUNCTIONS
OF HUMAN RESOURCE
MANAGEMENT
Objectives
After reading this unit, you should be able to:
l understand the meaning and concept of human resource management; and
l explain the functions of HR, and responsibilities and new roles of HR
practitioners.

Structure
2.1 Introduction
2.2 Concept of HRM
2.3 Objectives of HRM
2.4 Human Resource Functions
2.5 Summary
2.6 Self Assessment Questions

2.1 INTRODUCTION
Human resource management (HRM) is an approach to the management of people,
based on four fundamental principles. First, human resources are the most important
assets an organisation has and their effective management is the key to its success.
Second, this success is most likely to be achieved if the personnel policies and
procedures of the enterprise are closely linked with, and make a major contribution to,
the achievement of corporate objectives and strategic plans. Third, the corporate
culture and the values, organisational climate and managerial behaviour that emanate
from that culture will exert a major influence on the achievement of excellence. This
culture must, therefore, be managed which means that organisational values may need
to be changed or reinforced, and that continuous effort, starting from the top, will be
required to get them accepted and acted upon. Finally, HRM is concerned with
integration - getting all the members of the organisation involved and working together
with a sense of common purpose.

2.2 CONCEPT OF HRM
HRM is a strategic approach to the acquisition, motivation, development and
management of the organisation’s human resources. It is a specialised field that
attempts to devd .ng an appropriate corporate culture, and introducing programmes
which reflect and support the core values of the enterprise and ensure its success.
HRM is proactive rather than reactive, i.e., always looking forward to what needs to
be done and then doing it, rather than waiting to be told what to do about recruiting,
paying or training people, or dealing with employee relations problems as they arise.
The techniques for the application of HRM will include many familiar functions of
personnel managers, such as manpower planning, selection, performance appraisal,
2 4 salary administration, training and management development. These will be overlaid

by special programmes designed to improve communication systems, involvement, The Concept and
commitment, and productivity. Functions of Human
Resource Management
Broadly, there are three meanings attached to the concept of HRM. In the first place,
persons working in an organization are regarded as a valuable source, implying that
there is a need to invest time and effort in their development. Secondly, they are
human resources which means that they have their own special characteristics and,
therefore, cannot be treated like material resources. The approach focuses on the need
to humanise organisational life and introduce human values in the organisation. And
thirdly, human resources do not merely focus on employees as individuals, but also on
other social realities, units and processes in the organisation. These include the role or
the job a person has in the organisation, the dydadic unit, (consisting of the person and
his superior), the various teams in which people work, inter-team processes, and the
entity of the total organisation.
In its essence, HRM is the qualitative improvement of human beings who are
considered the most valuable assets of an organization-the sources, resources, and
end-users of all products and services. HRM is, no doubt, an outgrowth of the older
process and approach. But it is much more than its parent disciplines, viz., personnel
management, and behavioural science. HRM is also more comprehensive and deep-
rooted than training and development. Its approach is multi-disciplinary from the
beginning to the end. It is a scientific process of continuously enabling the employees
to improve their competency and capability to play their present as well as future
expected roles so that the goals of the organization are achieved more fully and at the
same time the needs of the employees are also met to an adequate extent.
HRM is a production model approach to personnel management. The HRM model is
characterised as being employee-oriented with an emphasis on the maximisation of
individual skills and motivation through consultation with the workforce so as to
produce high levels of commitment to company strategic goals. It is a resource to be
used to its fullest capacity. It is an asset to be invested in. HRM is concerned with
both the structure of work in a firm and with all the related employment practices that
are needed to carry out the work. HRM is not simply about HR or ‘people practices’,
it is about the management of work and people in the firm. Managing people includes
both individual and collective dimensions. The traditional personnel management is
non-strategic, separate from the business, reactive, short-term, and constrained by a
limited definition of its role as dealing with mostly unionised and low level employees.
The major attention of traditional personnel function is on personnel administration or
management while the major attention of HRM is on developing people and their
competencies. If personnel management is curative, HRM is preventive. The key
distinguishing feature of HRM is its evolving strategic role.
HRM essentially emphasises and incorporates those expectations which are not being
fulfilled through the traditional personnel management. It integrates in a meaningful
way the various sub-systems like performance appraisal, potentiality appraisal and
development, career planning, training and development, organisation development,
research and systems development, rewards, employee welfare and quality of work
life, industrial relations, and human resource information. Under the HRM approach,
some basic assumptions about human resources are also different from the traditional
approach. The important assumptions of HRM are as follows:
1) The members of an organisation are reservoirs of untapped resources.
2) There is scope for unlimited development of these resources.
3) It is more in the nature of self-development than development thrust from outside.
4) The organisation also undergoes development with the overall benefits along
with the development of its members.
2 5

Human Resource 5) The organisation further develops a culture in which utmost emphasis is placed
Management: Context, on harmonious superior-subordinate relations, teamwork, collaboration among
different groups of individuals, open communication, and above all, integration
of the goals of the organisation with the needs of the employees.
6) Top management takes the initiative for HRM, formulates necessary plans and
strategies, and creates an overall climate and support for its implementation.
The management of human resources is more of an art than a science. In practice it is
an “art” full of pitfalls, judgment calls, and learning from past mistakes.

Table 1: Some Basic Assumptions Underlying Traditional Personnel Function and
Human Resources System

Traditional Personnel Function (TPF) Human Resource Development (HRD)
1. TPF is an independent function 1. HRD is a sub-system of a larger
system (organisation)
2. There are several sub-functions 2. HRD is an organic whole: All the
under TPF parts are interlinked
3. The main task of TPF is to respond 3. The main task of HRD is to
effectively to the demands develop enabling capabilities
(coping role) (proactive role)
4. TPF has the main responsibilities for 4. All managers irrespective of
their personnel matters functions share the responsibility
of human resource functions
5. The main responsibilities of TPF 5. The responsibilities of HRS
relate to salary and job administration, relate to HRS, people, systems,
and management of people and their and the process of the total
development organisation
6. The major attention of TPF is on 6. The major attention of HRS is on
personnel administration or developing people and their
management competencies
7. Personnel system and procedures 7. HR systems and procedures should
should be designed to achieve be designed on the basis of process
maximum efficiency values to reduce human wastage
8. People in an organisation are 8. People are primarily motivated by
motivated mainly by salary and challenges and opportunities for
rewards development and creativity

2.3 OBJECTIVES OF HRM
The primary objective of HRM is to ensure the availability of competent and willing
workforce to an organisation. Apart from this, there are other objectives too.
Specifically, HRM objectives are four fold: societal, organisational, functional, and
personal.

Societal Objectives
The societal objectives are socially and ethically responsible for the needs and
challenges of society. While doing so, they have to minimize the negative impact of
such demands upon the organisation. The failure of organisations to use their
resources for society’s benefit in ethical ways may lead to restrictions. For example,
the society may limit human resource decisions to laws that enforce reservation in
hiring and laws that address discrimination, safety or other such areas of societal
2 6 concern.

Organisational Objectives The Concept and
Functions of Human
The organisational objectives recognise the role of human resource management in Resource Management
bringing about organisational effectiveness. Human resource management is not an
end in itself; it is only a means to assist the organisation with its primary objectives.
Simply stated the human resource department exists to serve the rest of the
organisation.

Functional Objectives
Functional objectives try to maintain the department’s contribution at a level
appropriate to the organisation’s needs. Human resources are to be adjusted to suit the
organisation’s demands. The department’s level of service must be tailored to fit the
organisation it serves.

Personal Objectives
Personal objectives assist employees in achieving their personal goals, at least insofar
as these goals enhance the individual’s contribution to the organisation. Personal
objectives of employees must be met if they are to be maintained, retained and
motivated. Otherwise, employee performance and satisfaction may decline giving rise
to employee turnover.

Table 2: HRM Objectives and Functions

HRM Objectives Supporting Functions

1. Societal Objectives 1. Legal compliance
2. Benefits
3. Union-management relations

2. Organisational Objectives 1. Human resource planning
2. Employee relations
3. Selection
4. Training and development
5. Appraisal
6. Placement
7. Assessment

3. Functional Objectives 1. Appraisal
2. Placement
3. Assessment

4. Personal Objectives 1. Training and development
2. Appraisal
3. Placement
4. Compensation
5. Assessment

Source: William B. Werther, Jr., and Keith Davis, Human Resources and Personnel
Management, p. 15.

2 7

Human Resource
Management: Context, 2.4 HUMAN RESOURCE FUNCTIONS
The role of human resource management is to plan, develop, and administer policies
and programmes designed to make expeditious use of an organisation’s human
resources. It is that part of management which is concerned with the people at work
and with their relationship within an enterprise. Its objectives are: (1) the effective
utilisation of human resources; (2) desirable working relationships among all members
of the organisation; and (3) maximum individual development.
The major functional areas in human resource management are: (1) planning,
(2) staffing, (3) employee development, and (4) employee maintenance. These four
areas and their related functions share the common objective of an adequate number of
competent employees with the skills, abilities, knowledge, and experience needed for
further organisational goals. Although each human resource function can be assigned
to one of the four areas of personnel responsibility, some functions serve a variety of
purposes. For example, performance appraisal measures serve to stimulate and guide
employee development as well as salary administration purposes. The compensation
function facilitates retention of employees and also serves to attract potential
employees to the organisation. A brief description of usual human resource functions
is given below:
Human Resource Planning: In the human resource planning function, the number
and type of employees needed to accomplish organisational goals are determined.
Research is an important part of this function because planning requires the collection
and analysis of information in order to forecast human resources supplies and to
predict future human resources needs. The basic human resource planning strategy is
staffing and employee development.
Job Analysis: Job analysis is the process of describing the nature of a job and
specifying the human requirements, such as skills, and experience needed to perform
it. The end product of the job analysis process is the job description. A job description
spells out work duties and activities of employees. Job descriptions are a vital source
of information to employees, managers, and personnel people because job content has
a great influence on personnel programmes and practices.
Staffing: Staffing emphasises the recruitment and selection of the human resources for
an organisation. Human resources planning and recruiting precede the actual selection
of people for positions in an organisation. Recruiting is the personnel function that
attracts qualified applicants to fill job vacancies.
In the selection function, the most qualified applicants are selected for hiring from
among those attracted to the organisation by the recruiting function. On selection,
human resource functionaries are involved in developing and administering methods
that enable managers to decide which applicants to select and which to reject for the
given jobs.
Orientation: Orientation is the first step toward helping a new employee adjust
himself to the new job and the employer. It is a method to acquaint new employees
with particular aspects of their new job, including pay and benefit programmes,
working hours, and company rules and expectations.
Training and Development: The training and development function gives employees
the skills and knowledge to perform their jobs effectively. In addition to providing
training for new or inexperienced employees, organisations often provide training
programmes for experienced employees whose jobs are undergoing change. Large
organisations often have development programmes which prepare employees for
higher level responsibilities within the organisation. Training and development
programmes provide useful means of assuring that employees are capable of
2 8
performing their jobs at acceptable levels.

Performance Appraisal: This function monitors employee performance to ensure that The Concept and
it is at acceptable levels. Human resource professionals are usually responsible for Functions of Human
Resource Management
developing and administering performance appraisal systems, although the actual
appraisal of employee performance is the responsibility of supervisors and managers.
Besides providing a basis for pay, promotion, and disciplinary action, performance
appraisal information is essential for employee development since knowledge of
results (feedback) is necessary to motivate and guide performance improvements.
Career Planning: Career planning has developed partly as a result of the desire of
many employees to grow in their jobs and to advance in their career. Career planning
activities include assessing an individual employee’s potential for growth and
advancement in the organisation.
Compensation: Human resource personnel provide a rational method for determining
how much employees should be paid for performing certain jobs. Pay is obviously
related to the maintenance of human resources. Since compensation is a major cost to
many organisations, it is a major consideration in human resource planning.
Compensation affects staffing in that people are generally attracted to organisations
offering a higher level of pay in exchange for the work performed. It is related to
employee development in that it provides an important incentive in motivating
employees to higher levels of job performance and to higher paying jobs in the
organisation.
Benefits: Benefits are another form of compensation to employees other than direct
pay for work performed. As such, the human resource function of administering
employee benefits shares many characteristics of the compensation function. Benefits
include both the legally required items and those offered at employer’s discretion. The
cost of benefits has risen to such a point that they have become a major consideration
in human resources planning. However, benefits are primarily related to the
maintenance area, since they provide for many basic employee needs.
Labour Relations: The term “labour relations” refers to interaction with employees
who are represented by a trade union. Unions are organisation of employees who join
together to obtain more voice in decisions affecting wages, benefits, working
conditions, and other aspects of employment. With regard to labour relations, the
personnel responsibility primarily involves negotiating with the unions regarding
wages, service conditions, and resolving disputes and grievances.
Record-keeping: The oldest and most basic personnel function is employee record-
keeping. This function involves recording, maintaining, and retrieving employee-
related information for a variety of purposes. Records which must be maintained
include application forms, health and medical records, employment history (jobs held,
promotions, transfers, lay-offs), seniority lists, earnings and hours of work, absences,
turnover, tardiness, and other employee data. Complete and up-to-date employee
records are essential for most personnel functions. More than ever employees today
have a great interest in their personnel records. They want to know what is in them, why
certain statements have been made, and why records may or may not have been updated.
Personnel records provide the following:
i) A store of up-to-date and accurate information about the company’s employees.
ii) A guide to the action to be taken regarding an employee, particularly by
comparing him with other employees.
iii) A guide when recruiting a new employee, e.g. by showing the rates of pay
received by comparable employees.
iv) A historical record of previous action taken regarding employees.
v) The raw material for statistics which check and guide personnel policies.
vi) The means to comply with certain statutory requirements. 2 9

Human Resource Personnel Research: All personnel people engage in some form of research activities.
Management: Context, In a good research approach, the object is to get facts and information about personnel
specifics in order to develop and maintain a programme that works. It is impossible to
run a personnel programme without some pre-planning and post-reviewing. For that
matter, any survey is, in a sense, research. There is a wide scope for research in the
areas of recruitment, employee turnover, terminations, training, and so on. Through a
well-designed attitude survey, employee opinions can be gathered on wages,
promotions, welfare services, working conditions, job security, leadership, industrial
relations, and the like. Inspite of its importance, however, in most companies, research
is the most neglected area because personnel people are too busy putting out fires.
Research is not done to put out fires but to prevent them.
Research is not the sole responsibility of any one particular group or department in an
organisation. The initial responsibility is that of the human resource department,
which however should be assisted by line supervisors and executives at all levels of
management. The assistance that can be rendered by trade unions and other
organisations should not be ignored, but should be properly made use of.
Apart from the above, the HR function involves managing change, technology,
innovation, and diversity. It is no longer confined to the culture or ethos of any single
organisation; its keynote is a cross-fertilisation of ideas from different organisations.
Periodic social audits of HR functions are considered essential.
HR professionals have an all-encompassing role. They are required to have a thorough
knowledge of the organisation and its intricacies and complexities. The ultimate goal
of every HR person should be to develop a linkage between the employee and the
organisation because the employee’s commitment to the organisation is crucial. The
first and foremost role of HR functionary is to impart continuous education to
employees about the changes and challenges facing the country in general, and their
organisation in particular. The employees should know about their balance sheet, sales
progress, diversification plans, restructuring plans, sharp price movements, turnover
and all such details. The HR professionals should impart education to all employees
through small booklets, video films, and lectures.
The primary responsibilities of a human resource manager are:
l To develop a thorough knowledge of corporate culture, plans and policies.
l To act as an internal change agent and consultant.
l To initiate change and act as an expert and facilitator.
l To actively involve himself in company’s strategy formulation.
l To keep communication lines open between the HRD function and individuals
and groups both within and outside the organisation.
l To identify and evolve HRD strategies in consonance with overall business
strategy.
l To facilitate the development of various organisational teams and their working
relationship with other teams and individuals.
l To try and relate people and work so that the organisation objectives are
achieved effectively and efficiently.
l To diagnose problems and to determine appropriate solution particularly in the
human resources areas.
l To provide co-ordination and support services for the delivery of HRD
programmes and services.
l To evaluate the impact of an HRD intervention or to conduct research so as to
identify, develop or test how HRD in general has improved individual or
organisational performance.
3 0

The following are the nine new roles of HR practitioner as suggested by Pat McLegan: The Concept and
Functions of Human
1) To bring the issues and trends concerning an organisation’s external and internal Resource Management
people to the attention of strategic decision-makers, and to recommend long-term
strategies to support organisational excellence and endurance.
2) To design and prepare HR systems and actions for implementation so that
they can produce maximum impact on organisational performance and
development.
3) To facilitate the development and implementation of strategies for transforming
one’s own organisation by pursuing values and visions.
4) To create the smoothest flow of products and services to customers; to ensure the
best and most flexible use of resources and competencies; and to create
commitment among the people who help us to meet customers’ needs whether
those people work directly for the organisation or not.
5) To identify learning needs and then design and develop structured learning
programmes and materials to help accelerate learning for individuals and groups.
6) To help individuals and groups work in new situations and to expand and change
their views so that people in power move from authoritarian to participative
models of leadership.
7) To help people assess their competencies, values, and goals so that they can
identify, plan, and implement development actions.
8) To assist individuals to add value in the workplace and to focus on the
interventions and interpersonal skills for helping people change and sustain
change.
9) To assess HRD practices and programmes and their impact and to communicate
results so that the organisation and its people accelerate their change and
development.
There are four roles which HR play, according to Dave Ulrich. The first, strategic
partner role-turning strategy into results by building organisations that create value;
the second, a change agent role-making change happen and, in particular, help it
happen fast; the third, an employee champion role-managing the talent or the
intellectual capital within a firm; and the fourth, an administrative role-trying to get
things to happen better, faster and cheaper.
Human resource management has received tremendous attention in recent years. Its
role in organisations has also undergone a substantial change and many organisations
have gradually oriented themselves from the traditional personnel management to a
human resource management approach, although many see it as the “old wine in a
new bottle.” The basic approach of HRM is to perceive the organisation in its totality.
Its emphasis is not only on production and productivity but also on the quality of life.
It seeks to achieve the fullest development of human resources and the fullest possible
socio-economic development.

Activity A
With business going global and competition becoming intense today HR has travelled
a long way from its conventional role as a support function to being a strategic
business partner in the present technology leveraged era. Discuss this statement by
citing suitable examples from your own organisation.
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3 1

Human Resource ............................................................................................................................................
Concept and Doundaries ............................................................................................................................................
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2.5 SUMMARY
The human resources of an organisation represent one of its largest investment. The
objectives of HRM include getting the organisation right, providing effective
motivation and leadership, obtaining and developing the right people, paying and
treating them fairly, and getting them involved in working productively. The
attainment of these objectives necessitates the performance of several functions. The
main HRM systems are: (1) appraisal system; (2) career system; (3) training system;
(4) work system; (5) cultural system; and (6) self-renewal system. All systems and
sub-systems of HRM must be incorporated in the organisation while setting the goals
and objectives. This will also integrate the purposes and processes and make HRM
more meaningful. Human resources functions are many and varied and include such
things as human resource planning, recruiting, selecting, training, counselling
employees, compensation management, and employer-employee relations. In small
organisations, most human resource functions are performed by owners or operating
managers. Large organisations usually have a human resource or personnel
department that is responsible for co-ordinating and directing the human resource
functions. Successful human resource management is essential to organisational
growth and success. In the light of new challenges, there are indications that human
resource people will play an increasingly important role in an organisation’s long-
range planning and policy-making activities.

2.6 SELF-ASSESSMENT QUESTIONS
1. What is “Human Resource Management”?
2. What functions does a human resource department normally perform?
3. Explain the new roles of HR managers.

Armstrong, M., Managing People, Kogan Page, Vol. 4, India, 1999.
Beaumont, P.B., Human Resource Management: Key Concepts and Skills, Sage
Publications, London, 1993.
Cascio, W.F., Managing Human Resources: Productivity, Quality of Work Life,
Profits, McGraw-Hill Book Company, New York, 1992.
Purcell J., Boxall P., Strategy and Human Resource Management, Palgrave,
Macmillan, New York, 2003.
Rao, T.V. and Others, HRD in the New Economic Environment, Tata McGraw-Hill
Book Company, New Delhi, 1994.

3 2

Structuring Human
UNIT 3 STRUCTURING HUMAN Resource Managemnet

RESOURCE MANAGEMENT
Objectives
After going through this unit, you should be able to:
l trace the evolution of Human Resource Management (HRM);
l discuss the scope and importance of HRM;
l describe different perspectives on HRM; and
l appreciate various components of HRM and their role.

Structure
3.1 Introduction
3.2 Evolution of HRM
3.3 Importance of HRM
3.4 Scope of HRM
3.5 Perspectives on HRM
3.6 Components of HRM
3.7 Summary

3.1 INTRODUCTION
For any organisation to function effectively, it must have resources of men (Human
Resource), money, materials and machiner. The resources by themselves cannot fulfill
the objectives of an organisation, they need to be collected, co-ordinated and utilised
through human resources. And, the effective management of human resources is also
vital. Hence, Human Resource Management (HRM) has emerged as a major function
in organisations. In this unit, we will be discussing about the structural aspect of
HRM such as evolution, approaches, components and scope.

3.2 EVOLUTION OF HRM
HRM activities have probably been performed since ancient times. The pioneering
work of Peter Drucker and Douglas McGregor in the 1950s laid its formal foundation.
Modern concept of HRM has developed through the following stages (Gupta, 1997).
a) The Commodity Concept: Before industrial revolution, the guild system was
the beginning of personnel management. Guild was a closely knit group
concerned with selecting, training, rewarding and maintaining workers. Labour
began to be considered a commodity to be bought and sold.
b) The Factor of Production Concept: Employees were considered a factor of
production just like land, materials, machinery. Taylor’s scientific management
stressed proper selection and training of employees so as to maximise
productivity.
3 3

Human Resource c) The Paternalistic Concept: Employees organised together on the basis of their
Management: Context, common interest and formed trade unions to improve. Also employers began to
provide schemes to workers. Employers assured a fatherly and protective attitude
towards their employees.
d) The Humanitarian Concept: It is based on the belief that employees had certain
inalienable rights as human beings and it is the duty of the employer to protect.
Rather social and psychological satisfaction was equally important. Hawthorne
Experiments of Douglas McGregor also generated considerable interest in human
problems of work place. This is also known as human relations concept.
e) The Behavioural Human Resource Concept: It aimed at analysing and
understanding human behaviour in organisation. Motivation, group dynamics,
organisational climate, organisational conflict etc. became popular under this
concept. Employees began to be considered as valuable assets of an organisation.
Efforts were made to integrate employee with the organisation so that
organisational goals and employees aspirations could be achieved
simultaneously. Focus shifted towards management practices like two way
communication, management by objectives, role of informal groups, quality
circles etc.
f) The Emerging Concept: Now employers are considered as partners in industry.
They are given share in company’s stock membership. Slowly and steadily, HRM
is emerging as a discipline. Unit 1 of this block has dealt in detail the emerging
scenario of HRM. Unit 2 has discussed the differences between traditional
personnel management and emerging HRM.

3.3 IMPORTANCE OF HRM
HRM is the central sub-system of an organisation (Figure 1).

Finance
Sub-system
s

s

s
s

Material HRM Technical
Sub-system Sub-system Sub-system
s
s

s

Marketing
s

Sub-system

Figure 1: HRM as central subsystem in an organisation

Source: Gupta, 1997

As the central sub-system, HRM interacts closely and continuously with all other
sub-systems of an organisation. The quality of people in all sub-systems depends
largely upon the policies, programmes and practices of the HRM sub-system.
The quality of human resources determines in turn the success of an organisation.
The importance of HRM can be discussed at four levels – corporate, professional,
social and national (Gupta, 1997).

3 4

1) Significance for an Enterprise: Human resource management can help an Structuring Human
enterprise in achieving its goals more efficiently and effectively in the following Resource Managemnet
ways:
a) Attracting and retaining the required talent through effective human
resource planning, recruitment, selection, placement, orientation,
compensation and promotion policies.
b) Developing the necessary skills and right attitudes among the employees
through training, development, performance appraisal, etc.
c) Securing willing co-operation of employees through motivation,
participation, grievance handling, etc.
d) Utilising effectively the available human resources.
e) Ensuring that the enterprise will have in future a team of competent and
dedicated employees.
2) Professional Significance: Effective management of human resources helps to
improve the quality of work life. It permits team work among employees by
providing a healthy, working environment. It contributes to professional growth
in the following ways:
a) Providing maximum opportunites for personal development of each
employee.
b) Maintaining healthy relationships between individuals and different work
groups.
c) Allocating work properly.
3) Social Significance: Sound human resource management has a great significance
for the society. It helps to enhance the dignity of labour in the following ways:
a) Providing suitable employment that provides social and psychological
satisfaction to people.
b) Maintaining a balance between the jobs available and the jobseekers in
terms of numbers, qualifications, needs and aptitudes.
c) Eliminating waste of human resources through conservation of physical and
mental health.
4) National Significance: Human resources and their management plays a vital role
in the development of a nation. The effective exploitation and utilisation of a
nation’s natural, physical and financial resources require an efficient and
committed manpower. There are wide differences in development between
countries with similar resources due to differences in the quality of their people.
Countries are underdeveloped because their people are backward. The level of
development in a country depends primarily on the skills, attitudes and values of
its human resources. Effective management of human resources helps to speed
up the process of economic growth which in turn leads to higher standards of
living and fuller employment.

3.4 SCOPE OF HUMAN RESOURCE MANAGEMENT
According to Dale Yoder, the scope of human resource management is very wide.
It consists of the following functions:
i) Setting general and specific management policy for organisational relationships,
and establishing and maintaining a suitable organisation for leadership and
co-operation.
3 5

Human Resource ii) Collective bargaining, contract negotiation, contract administration and
Management: Context, grievance handling.
iii) Staffing the organisation, finding, getting and holding prescribed types and
number of workers.
iv) Aiding in the self-development of employees at all levels providing opportunities
for personal development and growth as well as for acquiring requisite skill and
experience.
v) Developing and maintaining motivation for workers by providing incentives.
vi) Reviewing and auditing manpower management in the organisation.
vii) Industrial relations research—carrying out studies designed to explain employee
behaviour and thereby effecting improvement in manpower management.

The Indian Institute of Personnel Management has described the scope of human
resource management into the following aspects:
1) The Labour or Personnel Aspect: It is concerned with manpower planning,
recruitment, selection, placement, induction, transfer, promotion, demotion,
termination, training and development, layoff and retrenchment, wage and salary
administration (remuneration), incentives, productivity, etc.
2) The Welfare Aspect: This aspect is concerned with working conditions and
amenities such as canteens, creches, rest rooms, lunch rooms, housing, transport,
education, medical help, health and safety, washing facilities, recreation and
cultural facilities, etc.
3) The Industrial Relations Aspect: This is concerned with the company’s
relations with the employees. It includes union-management relations, joint
consultation, negotiating, collective bargaining, grievance handling, disciplinary
actions, settlement of industrial disputes, etc.

All the above aspects are concerned with human element in industry as distinct from
the mechanical element.

3.5 PERSPECTIVES OF HUMAN RESOURCE
MANAGEMENT*
You can examine the HRM function from several perspectives, and have already
looked in some detail at the historical perspective, on the evolution of the HRM
function. An environmental perspective tracks the external forces that continuously
come to bear on HR. A strategic perspective clarifies the role of the HRM function in
the strategy of the organisation. A political perspective shows to what extent and
maximise their self interest, which may not reflect the interests of the organisation. An
international perspective highlights the problems and opportunities that the HRM
function has to face in what is fast becoming a global marketplace. Finally, an
evaluation perspective shows the ways in which human resources activities can be
evaluated as to their usefulness in attaining organisational goals.

a) Historical Perspective on HRM
As the early developments have already been discussed under historical antecedents of
HRM, what follows will cover the recent trends only.

3 6 * Adapted from IGNOU Study material for CEMBA-CEMPA, C-3 (Human Resource Management).

Recent Trends Structuring Human
Resource Managemnet
The HRM function started getting attention and focus as research began to question
the notion that job satisfaction and productivity are strongly related. In the US, the
civil rights movement of the 1960s produced a good deal of legislation bearing on
employment relationships. Further, the increase in discrimination-based litigation
during the 1970s boosted the legitimacy of the HRM function in organisations.
Quite apart from various US-based interventions, it is the rise of international
competition in a global market that may finally liberate human resources management
from second-class status. In view of increasingly and fiercely competitive global
markets, the critical need for using employees as a competititve resource has become
increasingly evident. This international competition has led to four conceptual trends
in the HRM function:
l the need to link human resources to the strategic management process.
l the need to select, train, and compensate individuals to function in an
international marketplace.
l the need to understand the political dynamics that undermine rational HRM
decision-making processes.
l the need to provide quantitative estimates of the money value contributions made
by the human resources department.

b) Environmental Perspective on HRM
The legal environment serves as the filter and as the ultimate mechanism for merging
fact and value in society. When you examine legislation enacted during the human
relations movement, you will note that it dealt extensively with wages and work hours.
It also dealt with union-managment relations within the organisation. It provided for
supervising those relations, i.e., the rights of employees to organise and bargain
collectively vis-a-vis the rights of the employer and the union. In the US, these laws
are still in force, but the federal laws enacted during the 1960s and 70s dealt more
directly with the rights of the individual (or of classes of individuals, such as
minorities and women) in a wide range of issues concerning employer rights.

Organisations as Open Systems
Katz and Kahn (1978) proposed that organisations be viewed as open systems. ‘Open’
means that organisations are responsive to external pressures and ‘systems’ means
that a response by one element in the organisation/environment relationship usually
leads to a variety of other responses by the same element or other elements in that
relationship. Another premise is that, because of a flood of late 20th century laws
regulating many broad organisation-to-society matters, most organisations are more
permeable to external pressures than even before. In addition, the environment itself
also continues to chantge at a rapid pace.

Buffering Strategies as an Organisational Response
As the environment creates uncertainly, how can managers adequately plan, organise,
and control to deal with uncertainty? Organisations should develop a number of
strategies, including forecasting and buffering. Forecasting attempts to anticipate
change before it occurs. Buffering is concrete: designing structural devices (such as
larger or more specialised organistional units) and technological work-flow devices
(such as new or more complex procedures). These buffering devices assist the
organisation to be both proactive and reactive and to shield itself from the pressures of
the environment. They both ease schedules and help managers to figure out the nature
of the environmental pressures so that they can try to make sense of them. As a
3 7

Human Resource manager, you often need more time and information to deal with emerging events.
Management: Context, Once you reasonably assess the strength or potential impact of these pressures and
resources for coping with them, you are in a sound position to safeguard the
organisation. The notion of buffering seems to have been taken up by many
organisations in response to actual or potential pressures of the legal environment. As
a result, larger, more specialised human resources departments handle legal
requirements concerning the rights of employees.
The HRM function (or any other function), in designing buffering devices, draws on
the resources of the organisation and places greater responsibility on that function to
meet its organisational obligations. Therefore, HRM has to protect or shield the
organisation from errors of commission or omission in the management of its human
resources. As this obligation carries with it increased visibility and risk for their
function, human resources professionals have been seen at times as heroes and at
other times as traitors. Their reaction to this impact demonstrates the ‘open system’
theory of Katz and Kuehn: they have designed a few internal buffering devices of their
own. One way to reduce the risk of errors is to centralise human resources policy-
making and planning activities at the corporate level while continuing to support
decentralised decision-making at the unit level. It is at the unit level where you will see
more sensitivity to, and information regarding, critical interpersonal and intergroup
relationships.

c) Strategic Perspective on HRM
You have already learned about the various pressures the environment can exert upon
the organisation. These have required the organisation to link HR activities to the
organisation’s overall strategy. For example, US firms, in the ealry 1980s, had to face
stiff competition from foreign companies beginning to export their products to the
United States at lower prices than US companies could offer. The cost advantage
stemmed from lower labour costs and made it nearly impossible for American
companies to survive. They had to look for more efficient and effective ways to use
the resources available to them and stay afloat. The ensuing effort gave rise to the
concept of Strategic Human Resources Management (SHRM), defined as ‘the
pattern of planned human resource deployments and activities intended to enable
an organisation to achieve its objectives.’ The first among organisation theories to
explicitly discuss the concept of human resources strategies in the context of strategic
management were Galbraith and Nathanson. They recognised the need to fit human
resources into the strategy implementation process. As they presented the role of
human resources in the implementation of organisational strategy, they identified four
basic HRM sub-functions or strategies: selection appraisal, rewards, and
development.

Rewards
s

s

Selection Performance
s

Appraisal
s

s

s

Development
s

Figure 2: A Model of the Human Resources Management Function
Source: Tichy, 1982.

3 8 The figure above shows the interdependencies of the major HRM sub-functions.

d) Political Perspective on HRM Structuring Human
Resource Managemnet
You will, by now, have a clear understanding of the strategic perspective on HRM, the
objective of which is rational decision-making that aligns HRM practices with the
organisation’s strategic goals. However, as you have probably experienced, in
organisations not all decisions are rational, and many have very little to do with
achieving organisational goals. Recent writers in HRM propose that influence and
politics are a significant part of the HRM function, or at least that they strongly affect
that fuction.
What is meant by politics in HRM is that individuals or groups attempt to exert
influence over others for purposes and in ways that are not approved or sanctioned by
the organisation. Influence often consists of seeking to manage how others interpret
events and symbolic actions. Politics is defined as ‘the management of shared meaning
by individuals, groups, or organisation.’ This view of politics allows you to better
understand the role of influence in HRM, particularly with regard to personnel
selection, performance appraisal, and promotion/reward systems.
In the real world of HRM, it is not easy to identify perfectly the skill requirements of a
particular job or to assess perfectly an applicant’s level of each of the various skills,
as perceived in strategic HRM. There is neither a perfect fit nor a rational decision-
making process. It is the inability to assess fit perfectly in an objective manner that
lets politics enter the decision-making process.
You would have experienced in your work life that there is no objective standard for
assessisng fit. Selection decisions therefore often revolve around the perceived
similarity of an applicant’s skills with the standard. Thus, managing the perceptions of
the decision maker can allow the applicant an opportunity to influence the decision-
making process in a political manner. More specifically, the process of ‘impression
management’ in the employment interview is an example of politics in HRM.
Applicants usually search company information to assess the ‘type of employee’ that
the organisation seeks. An applicant wishing to join an organisation that publicises its
aggressive, market-oriented strategy will attempt to come across as quite aggressive in
the interview. The same applicant wishing to join a firm that promotes its team
atmosphers and group cohesiveness is likely to act significantly less aggressively in an
effort to appear to fit that organisation.
Recent research has demonstrated that attempts to bring influence to bear on the
employment interview do, in fact, affect decision outcomes. For example, it appears
that interviewees who exhibit controlling tactics such as self-prmotion and efforets to
dominate the interview prove more successful than those who act passive or
submissive.
Performance evaluation, too, seems to be an area of HRM that is influenced by
politics. A sacred principle of performance evaluation is to evaluate performance itself
rather than the person in the abstract. As, in most jobs, it is difficult to define the
measure all relevant aspects, the performance evaluation process can appear to be
mostly subjective. Evaluators do aquire generalised impressions regarding employees’
contributions to their organisation. Employees’ behaviours, as well as beliefs, values
and level of effort, all of which can be manipulated, can easily influence the
impressions of evaluators. Often a discrepancy exists between an individual’s
performance and the evaluation result, and this difference stems out of political
influence.
Promotion/succession systems are also subject to dynamics or political influence.
Firms may prefer to fill managerial positions within the ranks to provide motivation.
To assess the fit between the job vacancy and the person being promoted, the firm
must partly rely on past performance evaluations as well as information found through
3 9

Human Resource interviews and other means. You have already seen how these processes are affected
Management: Context, by political influence. Although many may not want to acknowledge the existence of
political influence in organisations, anecdotal and empirical data show very
convincingly that these processes are part and parcel of organisations. However, to
ignore their existence is short-sighted.

e) Interpersonal Perspective on HRM
For many years there has been increasing international competition, and today most
large corporations in the US, Europe and Japan function in a global economy. A
revolution in management practices, and increased emphasis on quality of work life
(QWL), has occurred over the same years. In order to compete internationally, many
overseas facilities must be established, with the effect that two general concerns are
being addressed by many American and European companies. Firstly, how does one
manage a company’s citizens working overseas? Secondly, how do organisational
management policies and practices in other cultures differ from those in the respective
home countries?
Expansion of production facilities outside US borders, for instance, provides HRM
concerns for the American companies. As a means of keeping production costs down
for the automotive industry, Lee Iacocca turned more and more to setting up plants
outside America. In 1993, he headed the fight to set up the North American Free
Trade Agreement (NAFTA) which created the world’s largest free trade zone by
virtually eliminating trade barriers among Canada, Mexico, and the US. In effect what
happened was that US firms capitalised on Mexico’s lower labour costs by building
production facilities there.
The foremost challenge for firms going overseas is the need to select and train
individuals who are able to work in a foreign culture. Therefore programmes featuring
international management and cross-cultural training have increased in value.
Also related to the issue of managing one’s citizens in a foreign setting is the problem
of adequate compensation for them. This arises out of the volatility of major foreign
currencies, particularly the US dollar. Corporations are meeting this challenge,
thererfore, by paying allowances for housing, payment of tax if required, education of
the manager’s children, cost of living adjustments etc.
The other concern – the influence of culture on HR practices – has created more
awareness among academics and HR practitioners. When there are joint ventures in
foreign countries, US firms, for instance, need to have a good understanding of the
foreign culture concerned. The 1987 conference on international personnel and human
resources management held at the National University of Singapore was showcase for
the work of academic researchers who had applied a number of methods in various
Pacific Rim countries (Japan, China, Taiwan, etc.) to learn the human resources
compared with US practices. You would be interested to know that inspite of these
efforts to gain an understanding of human resources practices in Pacific Rim
countries, evaluations have revealed that practice tends to be primaily guided by an
ethnocentric view of the world.
For a firm to be competitive these days, its HRM function mut be characterised by:
1) Transnational scope: going beyong a simple national or regional perspective
and making human resources decisions with a global perspective.
2) Transnational representation: globally competitive organistions must have
multinational representation among their managerial employees.
3) Transnational process: a decision making process that involves representatives
and ideas from variety of cultures.
4 0

f) Evaluation Perspective on HRM Structuring Human
Resource Managemnet
Two criteria are usually used to assess the quality of an enterprise’s HRM function:
efficiency and effectiveness. In judging effectiveness we ask, ‘Is HRM doing the right
things?’ whereas efficiency ‘doing things right’ in the sense of maximising outputs
relative to inputs. Effectiveness may involve biases of people because people decide
what the right things are. Efficiency, by contrast, is associated with an internal value-
free assessment of the function. The HRM function can be judged efficient but
ineffective, effective but inefficient, ineffective and inefficient, or effective and
efficient: the desired status.
Efficiency may be determined from short-term activities such as personnel functions.
For instance, how fast were personnel requisitions filled? However, activities like
preparing job descriptions and providing career counselling are long-term activities
critical to the effectiveness of the organisation. In the short run, they may seem to
resist efforts at efficiency improvement. The ideal is to strike an optimal mix.

Personnel Audits and Utility Analysis
One popular approach to assessing HRM function is called the personnel audit, which
has two components: a procedural audit and a functional audit. The former focusses
on the activities performed by members of the HR department and the amount of time
spent on each. It is internal to the HR department and represents a measure of the
function’s efficiency. The latter, the functional audit, seeks to measure the function’s
effectiveness. In other words, it attempts to assess how well the function is serving the
organisation in helping achieve short- and long-term goals.
Some researchers have demonstrated how human resources can be subjected to ‘utility
analysis’ that leads to determining the money value of HRM activities to the
organisation.

3.6 COMPONENTS OF HRM
The following are the major components of HRM (Sarma, 1998).
Human Resource Organisation: Human resource organisation is concerned with
achieving success by organisation design and development, motivation, the application
of effective leadership, and the process of getting across the message about what the
enterprise is setting out to do and how it proposes to do it. The fundamental objective
of human resource organisation is to ensure that every aspect of the organisation,
employment, motivation, and management of people is integrated with the strategic
objectives of the business and contribute to the successful achievement of those
objectives. The human resource organisation programme has to take account of
cultural issues so that the desired corporate culture can be developed or reinforced.
Moreover, organisational development programmes and interventions are needed to
achieve better integration, improve teamwork, motivate human resource, develop
proper leadership, facilitate communication system, manage conflict and change, and
obtain commitment.
Human Resource Planning: Human resource planning sets out to define how many
people the organisation wants; the type of people the organisation needs at present and
in the future, in terms of their expertise; and how they “fit” the corporate culture. It
involves the forecasting of both the supply and demand for future labour. It provides
the base for recruitment programmes and for human resource development plans.
Human Resource Systems: Human resource systems are the essential programmes
needed to recruit, appraise, pay and look after the health, safety and well-being of the
employees in the organisation. The main key programmes are: 4 1

Human Resource a) Recruitment management: It is a process of obtaining the required human
Management: Context, resource for an organisation.
b) Information management: It is a method of ensuring that all policies and
practices are to be well articulated and effectively communicated to the
workforce.
c) Training management: It is a system of identification of training needs,
preparation of a training strategy, and an appropriate training system.
d) Performance management: It is a technique of appraising performance
systematically against defined criteria, reviewing progress to date and assessing
the potential for advancement. There are three main appraisal systems such as
performance appraisal, potential appraisal, and performance coaching or
counselling.
e) Reward management: It is a method to ensure that people are rewarded in
accordance with their contribution.
f) Career management: It is a system of charting special career paths for the
individual employees for advancement in the organisation.
g) Health and safety management: It is a system of maintaining a healthy and safe
system of work in an organisation. (h) Discipline management: It is a system of
administering discipline to foster positive employee behaviour that will promote
organisational objectives.
i) Culture management: It is a system of thinking and behaving shaped by the
values, attitudes, rituals and sanctions in an organisation.
Human Resource Development (HRD): Lippit (1978) points out that HRD as a
system depends on: (a) the work itself which generates a higher degree of
responsibility for the employees; (b) the individual’s personal and professional growth;
(c) the improved quality output as a result of increased responsibility; and (d) the
organisation as an open system. Focus on all these aspects is what HRD all about.
Rao (1985) defines HRD as “a process by which the employees of an organisation are
helped, in a continuous planned way to: (a) acquire or sharpen capabilities required to
perform various tasks and functions associated with their present or expected future
roles; (b) develop their general enabling capabilities as individuals so that they are
able to discover and exploit their own inner potentials for their own and/or
organisational development purposes; and (c) develop an organisational culture where
superior-subordinate relationship, team-work, and collaboration among different sub-
units are strong and contribute to the organisational health, dynamism and pride of
employees.”
HRD is a series of organised activities conducted within a specified time and designed
to produce behavioural change. It is rooted in the belief that human beings have the
potential to do better. It has two main purposes: (a) to provide employees with a
greater opportunity to grow and succeed within a company; and (b) to strengthen
management and professional teams at all organisational levels. Furthermore, it aims
at developing employee capabilities in line with their career interests and with the
manpower needs of the company.
HRD as a function consists of various activities related to training, education and
development, and performance appraisal. All aspects of training and appraisal playa
significant role in achieving the individual’s growth and development. In this respect
HRD is more a proactive and supportive function wherein the organisation has to take
a lead in helping the people to grow and realise their potential role.
Human resource development programmes help to ensure that the organisation has the
4 2 people with the skills and knowledge it needs to achieve its strategic objectives. They

aim to train new employees to the level of performance required in their jobs quickly Structuring Human
and economically and to develop the abilities of existing staff so that performance in Resource Managemnet
their present jobs are improved and they are prepared to take on increased
responsibilities in the future.
The thrust of human resource development is on training and development. It is a
dynamic process which aims at improving the skills and talents of the personnel.
Training fills the gap between what someone can do and what he should be able to do.
Its first aim is to ensure that, as quickly as possible, people can reach an acceptable
level in their jobs. Training then builds on this foundation by enhancing skills and
knowledge as required to improve performance in the present job or to develop the
potential for the future.
Development can be defined as the modification of behaviour through experience. It
provides for people to do better in the existing jobs and prepares them for greater
responsibility in the future. It builds on strengths and helps to overcome weaknesses,
and ensures that the organisation has the expertise it needs. Development operates at
all levels - shop floor level, middle management level, and top management level -
covering executives and non-executives.
HRD is an important force for the future. The challenges to HRD will continue.
Instead of doers, HRD practitioners will be the process designers, researchers,
strategists, advisors, business managers, and consultants. Looking ahead to the 21 st
century, it is clear that the HRD community must accelerate the trends that have just
begun. They must: (a) ensure that all people practice and support continuous
development, learning and high performance; (b) work to create participative cultures
and to dissolve autocratic and dependent mindsets; (c) help prepare people and
institutions to succeed in a rapidly changing global village; (d) treat their employees
like customers for enduring success of the organisation.
Human Resource Relationships: Human resource relationships deal with the
handling of employees individually and collectively asmembers of trade unions or staff
associations. Their main aim is to increase co-operation and trust and to involve
employees actively in the company’s affairs. It also deals with problem-solving
techniques, particularly to solve problems relating to disciplinary cases and
grievances. There are two sides to a dispute in most organisations: the management
and the workers. There is a gap and the means have to be found to bridge that gap.
Whether or not unions exist, it is highly desirable for the management to develop
methods of dealing with employees collectively. Nonetheless, relationships with unions
often involve confrontations. The necessary techniques must be evolved for
encouraging mutuality and working together in the interests of all.
Unions have to be managed like everything else in an organisation. Management
normally gets the union it deserves. If it handles unions the wrong way, the results for
the organisation can be disastrous. An approach to collective dealing should be:
(a) the recognition of the union, (b) the respective role perfonnance of management
and union, (c) the type of procedures one can adopt to regularize relationships with
unions, (d) the basic techniques of negotiating with unions, (e) the mechanism of
involvement through participation, both traditional fonns of joint consultation as well
as the Japanese import of quality circles.
Human Resource Utilisation: According to Peters and Watennan, to achieve
productivity through people, it is very essential to “treat them as adults, treat them as
partners, treat them with dignity, and treat them with respect.” These fundamental
human relations values provide the base for productivity management programmes,
which use techniques such as method study to improve efficiency. Both managers and
workers must be persuaded somehow to realise that they have a common interest in
increasing output. 4 3

Human Resource The following actions are required to improve the use of human resources: (a) conduct
Management: Context, a productivity drive; (b) improve manpower budgeting and control techniques;
(c) introduce work measurement; (d) use appropriate payment method by results;
bonus and profit-sharing schemes; (e) improve motivation; (f) involve employees in
improvement programmes; (g) introduce new technology; (h) negotiate appropriate
productivity agreements; and (i) introduce training programmes based on an analysis
of productivity needs.
Human Resource Accounting (HRA): HRA means accounting for people as the
organisational resource. It is the measurement of the cost and value of people to
organisations and involves measuring the costs incurred on recruiting, selecting,
hiring, training and developing employees and judging their economic value to the
organisation. HRA can be very useful in managerial decision-making. For instance,
whether it is recruitment and selection or replacement of an employee, HRA can
provide an estimate of the cost involved in the process.
Similarly, it can help the management in budgeting for development of human
resources. HRA can also provide data pertaining to turnover costs, the cost of
employee’s absence and its impact on performance of others.
Human Resource Audit: The purpose of a human resource audit is to assess the
effectiveness of the human resource function and to ensure regulatory compliance.
Human resource audit is a vast subject and covers many delicate aspects of human
and organisational interactions.
The HRD auditor has to study the organisation design, its objective, performance of
its human resources, as well as the proper maintenance of HRD climate and practices.
The job of the HR auditor is not an easy one. To gain success, he has to be very
selective about the area and procedure he wishes to follow. Auditing in the field of
human resources is a difficult job, more so because unlike other audits, the auditor has
to deal with individuals vis-a-vis organisational priorities. Therefore, the HR auditor
is required to be very systematic in his job and define the task clearly as to which
arena he has to cover.

3.7 SUMMARY
HRM has emerged as a major function in organisations. Its origin can be
traced back to Taylore and McGregor age. Today employee’s position in the
organisations has changed. Managing human resources is one of the key elements in
the co-ordination and management of work organisations. As discussed in this unit,
the scope of HRM is very wide and there are four perspectives on HRM.
HRM is carried out in an organisation with the help of number of components it has.
Hence, HRM is important for organisations, for organisation’s members as well
as for the nation.

3.8 SELF-ASSESSMENT QUESTIONS
1) Trace the evolution of HRM.
2) Discuss the importance and scope of HRM.
3) Explain different perspectives on HRM.
4) Describe the components of HRM.

4 4

Structuring Human
3.9 FURTHER READINGS Resource Managemnet

Yoder, Dale (1977). Personnel Management and Industrial Relations, Prentice Hall
of India, New Delhi.
Indian Institute of Personnel Management (1973). Personnel Management in India,
Asia Publishing House, Mumbai.
Sarma, A.M. (1998). Personnel and Human Resource Management, Himalaya
Publishing House, New Delhi.
Tripathi, P.C. (2004). Personnel Manament and Industrial Relations, Sultan Chand
& Sons, New Delhi.
Katz, R. and Kahn, R. (1978). The Social Psychology of Organisation, Wiley, New
York.
Galbraith, J. and Nathonson, R. (1978). Strategy Implementation: The Role of
Structure and Process, St. Paul, Minnesota.
Tichy, N.N. (182). Strategic Human Resource Management, Sloan Management
Review.

4 5

ASSESSMENT CENTRES, 360 DEGREE APPRAISAL

AND CAREER & SUCCESSION PLANNING

INTRODUCTION

This unit deals with mechanisms of performance & potential appraisals and ways and

means employed by organizations to provide growth opportunities to employees.

Nobody wants to work in dead end job. Employees aspire to grow and expect this

growth to take place at frequent intervals

ASSESSMENT CENTRES

Employees are not contended by just having a job. They want growth and individual

development in the organization. “Assessment centre” is a mechanism to identify the

potential for growth. It is a procedure and not a location that uses a variety of

techniques to evaluate employees for manpower purposes and decisions.

Assessment centers are a more elaborate set of performance simulation tests,

specifically designed to evaluate a candidate’s managerial potential. Line executives,

supervisors, and/or trained psychologists evaluate candidates as they go through one

to several days of exercises that simulate real problems that they would confront on

the job. Based on a list of descriptive dimensions that the actual job incumbent has to

meet, activities might include interviews, in-basket problem-solving exercises,

leaderless group discussions, and business decision games. For instance, a candidate

might be required to play the role of a manager who must decide how to respond to

ten memos in his/her in-basket within a two-hour period. Assessment centers have

consistently demonstrated results that predict later job performance in managerial

positions.

The American Telephone and Telegraph Company (AT&T) began experiments with

Assessment Centre approach in the 1950’s as a part of a wide programme of

management development. The AT&T Company designated a particular building

where the Assessments were carried out. This building became known as Assessment

centre and the name has stuck as a way of referring to the method. The method

became established in the industry in the USA during the 1960’s and 1970’s and was

introduced in UK during this period.

This method is now regarded as one of the most accurate and valid assessment

procedures and is widely used for selection and development.

According to IPMA (The International Personnel Management Association), an

assessment center consists of a standardized evaluation of behavior based on multiple

inputs. They are used to assess the strengths, weaknesses and potential of employees.

The specific objective is to reinforce strengths, overcome weaknesses and exploit

potential of the employees through training & developmental efforts. Several trained

observers and techniques are used. Judgments about behavior are made, in major part,

from specifically developed assessment simulations. These judgments are pooled in a

meeting among the assessors or by a statistical integration process. In an integration

discussion, comprehensive accounts of behavior, and often ratings of it, are pooled.

The discussion results in evaluations of the performance of the assessees on the

dimensions/ competencies or other variables that the assessment center is designed to

measure. There is a difference between an assessment center and assessment center

methodology. Various features of the assessment center methodology are used in

procedures that do not meet all of the guidelines set forth here, such as when a

psychologist or human resource professional, acting alone, uses a simulation as a part

of the evaluation of an individual. Such personnel assessment procedures are not

covered by these guidelines; each should be judged on its own merits. Procedures that

do not conform to all the guidelines here should not be represented as assessment

centers or imply that they are assessment centers by using the term “assessment

center” as part of the title. The following are the essential elements for a process to be

considered an assessment center:

a. Job Analysis

A job analysis of relevant behaviors must be conducted to determine the

dimensions, competencies, attributes, and job performance indices important to

job success in order to identify what should be evaluated by the assessment

center. The type and extent of the job analysis depend on the purpose of

assessment, the complexity of the job, the adequacy and appropriateness of prior

information about the job, and the similarity of the new job to jobs that have been

studied previously. If past job analyses and research are used to select dimensions

and exercises for a new job, evidence of the comparability or generalizability of

the jobs must be provided. If job does not currently exist, analyses can be done of

actual or projected tasks or roles that will comprise the new job, position, job

level, or job family. Target dimensions can also be identified from an analysis of

the vision, values, strategies, or key objectives of the organization. Competency-

modeling procedures may be used to determine the dimensions/ competencies to

be assessed by the assessment center, if such procedures are conducted with the

same rigor as traditional job analysis methods. Rigor in this regard is defined as

the involvement of subject matter experts who are knowledgeable about job

requirements, the collection and quantitative evaluation of essential job elements,

and the production of evidence of reliable results. Any job analysis or competency

modeling must result in clearly specified categories of behavior that can be

observed in assessment procedures.

A “competency” may or may not be amenable to behavioral assessment as

defined herein. A competency, as used in various contemporary sources, refers to

an organizational strength, an organizational goal, a valued objective, a construct,

or a grouping of related behaviors or attributes. A competency may be considered

a behavioral dimension for the purposes of assessment in an assessment center if

i. it can be defined precisely

ii. Expressed in terms of behaviors observable on the job or in a job family

and in simulation exercises.

iii. A competency also must be shown to be related to success in the target job

or position or job family.

b. Behavioral Classification

Assessment centre requires that Behaviors displayed by participants must

be classified into meaningful and relevant categories such as dimensions,

attributes, characteristics, aptitudes, qualities, skills, abilities,

competencies, and knowledge.

c. Assessment Techniques

The techniques used in the assessment center must be designed to provide

information for evaluating the dimensions previously determined by the

job analysis. Assessment center developers should establish a link from

behaviors to competencies to exercises/assessment techniques. This

linkage should be documented in a competency-by exercise/ assessment

technique matrix.

d. Multiple Assessments

Multiple assessment techniques must be used. These can include tests,

interviews, questionnaires, sociometric devices, and simulations. The

assessment techniques are developed or chosen to elicit a variety of

behaviors and information relevant to the selected competencies/

dimensions. Self-assessment and 360 degree assessment data may be

gathered as assessment information. The assessment techniques will be

pre-tested to ensure that the techniques provide reliable, objective and

relevant behavioral information. Pre-testing might entail trial

administration with participants similar to assessment center candidates,

thorough review by subject matter experts as to the accuracy and

representativeness of behavioral sampling and/or evidence from the use of

these techniques for similar jobs in similar organizations.

e. Simulations

The assessment techniques must include a sufficient number of job related

simulations to allow opportunities to observe the candidate’s behavior

related to each competency/dimension being assessed. At least one—and

usually several—job related simulations must be included in each

assessment center. A simulation is an exercise or technique designed to

elicit behaviors related to dimensions of performance on the job requiring

the participants to respond behaviorally to situational stimuli. Examples of

simulations include, but are not limited to, group exercises, in-basket

exercises, interaction (interview) simulations, presentations, and fact-

finding exercises. Stimuli may also be presented through video based or

virtual simulations delivered via computer, video, the Internet, or an

intranet. Assessment center designers also should be careful to design

exercises that reliably elicit a large number of competency-related

behaviors. In turn, this should provide assessors with sufficient

opportunities to observe competency-related behavior.

f. Assessors

Multiple assessors must be used to observe and evaluate each assessee.

When selecting a group of assessors, consider characteristics such as

diversity of age, sex, organizational level, and functional work area.

Computer technology may be used to assess in those situations in which it

can be shown that a computer program evaluates behaviors at least as well

as a human assessor. The ratio of assessees to assessors is a function of

several variables, including the type of exercises used, the dimensions to

be evaluated, the roles of the assessors, the type of integration carried out,

the amount of assessor training, the experience of the assessors, and the

purpose of the assessment center. A typical ratio of assessees to assessors

is two to one. A participant’s current supervisor should not be involved in

the assessment of a direct subordinate when the resulting data will be used

for selection or promotional purposes.

g. Assessor Training

Assessors must receive thorough training and demonstrate performance

that meets requirements prior to participating in an assessment center. The

training should focus on processing of information, drawing conclusions,

interview techniques and understanding behaviour.

h. Recording Behavior

A systematic procedure must be used by assessors to record specific

behavioral observations accurately at the time of observation. This

procedure might include techniques such as handwritten notes, behavioral

observation scales, or behavioral checklists. Audio and video recordings

of behavior may be made and analyzed at a later date.

i. Reports

Assessors must prepare a report of the observations made during each

exercise before the integration discussion. It is suggested that assessors

must prepare the report immediately after the assessment is over otherwise

they are likely to forget the details. Not only this, these reports must be

independently made.

j. Data Integration

The integration of behaviors must be based on a pooling of information

from assessors or through a statistical integration process validated in

accordance with professionally accepted standards. During the integration

discussion of each dimension, assessors should report information derived

from the assessment techniques but should not report information

irrelevant to the purpose of the assessment process. The integration of

information may be accomplished by consensus or by some other method

of arriving at a joint decision. Methods of combining assessors’

evaluations of information must be supported by the reliability of the

assessors’ discussions. Computer technology may also be used to support

the data integration process provided the conditions of this section are met.

Uses of Assessment Centres

Data generated during the process of Assessment can become extremely useful in

identifying employee potential for growth. This data can be used for

a. Recruitment and promotion

Where particular positions which need to be filled exist, both internal and

external can be assessed for suitability to those specific posts.

b. Early identification of personnel

The underlying rationale here is the need for the organization to optimise

talent as soon as possible. High potential people also need to be motivated so

that they remain with the organization.

c. Diagnosis of training and development needs

It offers a chance to establish individual training and development needs while

providing candidates with a greater appreciation of their needs.

d. Organizational Planning

Assessment centers can be used to identify area where widespread skill

deficiencies exist within organizations, so that training can be developed in these

areas. Results can also be integrated with human resource planning data to

provide additional information concerning number of people with particular skills

needed to meet future needs.

Assessment Centres and Development Centres

Traditionally an assessment centre consisted of a suite of exercises designed to assess

a set of personal characteristics. It was seen as a rather formal process where the

individuals being assessed had the results fed back to them in the context of a simple

yes/no selection decision. However, recently we have seen a definite shift in thinking

away from this traditional view of an assessment centre to one which stresses the

developmental aspect of assessment. A consequence of this is that today it is very rare

to come across an assessment centre which does not have at least some

developmental aspect to it. Increasingly assessment centres are stressing a

collaborative approach which involves the individual actively participating in the

process rather than being a passive recipient of it. In some cases we can even find

assessment centres that are so developmental in their approach that most of the

assessment work done is carried out by the participants themselves and the major

function of the centre is to provide the participants with feedback that is as much

developmental as judgmental in nature.

Assessment centres typically involve the participants completing a range of exercises

which simulate the activities carried out in the target job. Various combinations of

these exercises and sometimes other assessment methods like psychometric testing

and interviews are used to assess particular competencies in individuals. The theory

behind this is that if one wishes to predict future job performance then the best way of

doing this is to get the individual to carry out a set of tasks which accurately sample

those required in the job. The particular competencies used will depend upon the

target job but one should also learn such competencies such as relating to people;

resistance to stress; planning and organising; motivation; adaptability and flexibility;

problem solving; leadership; communication; decision making and initiative. The fact

that a set of exercises is used demonstrates one crucial characteristic of an assessment

centre - namely that it is behaviour that is being observed and measured. This

represents a significant departure from many traditional selection approaches which

rely on the observer or selector attempting to infer personal characteristics from

behaviour based upon subjective judgment and usually precious little evidence. This

approach is rendered unfair and inaccurate by the subjective whims and biases of the

selector and in many cases produces a selection decision based on a freewheeling

social interaction after which a decision was made as whether the individual's 'face fit'

with the organisation.

Differences between Assessment and Development Centres

The type of centre can vary between the traditional assessment centre used purely for

selection to the more modern development centre which involves self-assessment and

whose primary purpose is development. One might ask the question 'Why group

assessment and development centres together if they have different purposes?' The

answer to that question is threefold.

a. they both involve assessment and it is only the end use of the information

obtained which is different i.e. one for selection and one for development.

b. it is impossible to draw a line between assessment and development centres

because all centres, be they for assessment or development naturally lie

somewhere on a continuum somewhere between the two extremes.

c. Most assessment centres involve at least some development and most

development centres involve at least some assessment. This means that it is very

rare to find a centre devoted to pure assessment or pure development. It is easier

to think about assessment centres as being equally to do with selection and

development because a degree of assessment goes on in both.

d. Development Centres grew out of a liberalization of thinking about assessment

centres. While assessment centres were once used purely for selection and have

evolved to have a more developmental flavour, the language used to describe

them has not. Another problem with using the assessment - development

dichotomy is that at the very least it causes us to infer that little or no assessment

goes in development centres. While one hears centres being called assessment or

development centres assessment goes on in both and to that extent they are both

assessment centres. The end result of this is that it is not possible to talk about

assessment or development centres in any but the most general terms. A number

of differences between assessment and development centres exist are presented

below:

a. Assessment centres have a pass/fail criteria while Development centres do not

have a pass/fail criteria

b. Assessment centres are geared towards filing a job vacancy while Development

centres are geared towards developing the individual

c. Assessment Centres address an immediate organisational need while

Development Centres address a longer term need

d. Assessment Centres have fewer assessors and more participants while

Development Centres have a 1:1 ratio of assessor to participant

e. Assessment Centres involve line managers as assessors while Development

Centres do not have line managers as assessors

f. Assessment Centres have less emphasis placed on self-assessment while

Development Centres have a greater emphasis placed on self-assessment

g. Assessment Centres focus on what the candidate can do now while Development

Centres focus on potential

h. Assessment Centres are geared to meet the needs of the organisation while

Development Centres are geared to meet needs of the individual as well as the

organization.

i. Assessment Centres assign the role of judge to assessors while Development

Centres assign the role of facilitator to assessors.

j. Assessment Centres place emphasis on selection with little or no developmental

while Development Centres place emphasis on developmental feedback and

follow up with little or no selection function.

k. Assessment Centres feedback and follow up while Development Centres give

feedback immediately.

l. Assessment Centres give feedback at a later date while Development Centres

involve the individual having control over the information obtained.

m. Assessment Centres have very little pre-centre briefing while Development

Centres have a substantial pre-centre briefing.

n. Assessment Centres tend to be used with external candidates while Development

Centres tend to be used with internal candidates.

360 DEGREE APPRAISAL

The 360 degree feedback process involves collecting perceptions about a person’s

behavior and the impact of that behavior from the person’s boss or bosses, direct reports,

colleagues, fellow members of project teams, internal and external customers, and

suppliers. Other names for 360 degree feedback are multi-rater feedback, multi-source

feedback, full-circle appraisal, and group performance review" .360 degree feedback is a

method and a tool that provides each employee the opportunity to receive performance

feedback from his or her supervisor and four to eight peers, subordinates and customers.

360 degree feedback allows each individual to understand how his effectiveness as an

employee, co-worker, or staff member is viewed by others. The most effective processes

provide feedback that is based on behaviors that other employees can see. The feedback

provides insight about the skills and behaviors desired in the organization to accomplish

the mission, vision, goals and values. The feedback is firmly planted in behaviors needed

to exceed customer expectations.

By contrasting self-evaluation results with feedback culled from others through 360

degree feedback, the process enables an individual to integrate feedback into his or her

self-image, "360 could be of use to an organization that truly believes that performance

can be improved by changing individual behavior and a key reason the desired

behavior(s) is not occurring is that many people

People who are chosen as raters are usually those that interact routinely with the person

receiving feedback. The purpose of the feedback is to

a. assist each individual to understand his or her strengths and weaknesses

b. to contribute insights into aspects of his or her work needing professional

development.

Following are some of the major considerations in using 360 degree feedback. These are

basically concerned with how to:

a. select the feedback tool and process,

b. select the raters,

c. use the feedback,

d. review the feedback, and

e. manage and integrate the process into a larger performance management system.

Features of 360 degree appraisal

Organizations that are using with the 360 degree component of their performance

management systems identify following positive features of the process. These features

will manifest themselves in well-managed, well-integrated 360 degree processes.

a. Improved Feedback from More Sources: Provides well-rounded feedback from

peers, reporting staff, co-workers, and supervisors. This can be a definite

improvement over feedback from a single individual. 360 feedback can also save

managers’ time in that they can spend less energy providing feedback as more

people participate in the process. Co-worker perception is important and the

process helps people understand how other employees view their work.

b. Team Development: Helps team members learn to work more effectively

together. Team members know more about how other members are performing

than their supervisor. Multirater feedback makes team members more accountable

to each other as they share the knowledge that they will provide input on each

members’ performance. A well-planned process can improve communication and

team development.

c. Personal and Organizational Performance Development: 360 degree feedback is

one of the best methods for understanding personal and organizational

developmental needs.

d. Responsibility for Career Development: For many reasons, organizations per se

are no longer responsible for developing the careers of theiremployees. Multirater

feedback can provide excellent information to individuals about what they need to

do to enhance their career. Additionally, many employees feel 360 degree

feedback is more accurate, more reflective of their performance, and more

validating than feedback from the supervisor alone. This makes the information

more useful for both career and personal development.

e. Reduced Discrimination Risk: When feedback comes from a number of

individuals in various job functions, biases because of varying reasons are

reduced. The judgemental errors of the supervisors are eliminated as the feedback

comes from various sources.

f. Improved Customer Service: Feedback process involves the internal or external

customer. Each person receives valuable feedback about the quality of his

product or services. This feedback should enable the individual to improve the

quality, reliability, promptness, and comprehensiveness of these products and

services to his/her customers.

g. Training Needs Assessment: Multirater feedback provides comprehensive

information about organization training needs and thus helps in mounting relevant

training programmes. Such programmes add value to the contribution made by the

individual employee.

Benefits of 360 degree Appraisal

Following benefits of 360 degree Appraisal accrue to the individual, team and

organization:

To the individual

a. This process helps individuals to understand how others perceive them

b. It uncovers blind spots

c. It provides feedback that is essential for learning

d. Individuals can better manage their own performance and careers

e. Quantifiable data on soft skills is made available.

To the team:

a. It increases communication between team members

b. It generates higher levels of trust and better communication as individuals identify

the causes of breakdowns

c. It creates better team environment as people discover how to treat others and how

they want to be treated

d. It supports teamwork by involving team members in the development process

e. It increased team effectiveness

To the organization:

a. It reinforces corporate culture of openness and trust.

b. It provides better opportunities for career development for employees

c. Employees get growth and promotional opportunities.

d. It improves customer service by having customers contribute to evaluation

e. It facilitates the conduct of relevant training programmes.

CAREER PLANNING

Career is viewed as a sequence of position occupied by a person during the course of his

lifetime. Career may also be viewed as amalgam of changes in value, attitude and

motivation that occur, as a person grows older. The implicit assumption is that an

individual, can make a difference in his destiny over time and can adjust in ways that

would help him to enhance and optimize the potential for his own career development

Career planning is important because it would help the individual to explore, choose and

strive to derive satisfaction with ones career object.

The process by which individuals plan their life’s work is referred to as career planning.

Through career planning, a person evaluates his or her own abilities and interests,

considers alternative career opportunities, establishes career goals, and plans practical

developmental activities.

Career planning seeks to achieve the following objectives:

a. It attracts and retains the right persons in the organization

b. It maps out careers of employees suitable to their ability, and their willingness to be

trained and developed for higher positions

c. It ensures better use of human resources through more satisfied and productive

employees

d. It ensures more stable workforce by reducing labour turnover and absenteeism

e. It utilizes the managerial talent available at all levels within the organization

f. It improves employee morale and motivation by matching skills to job requirements

and by providing job opportunities for promotion

g. It ensures that promising persons get experience that will equip them to reach

responsibility for which they are capable.

h. It provides guidance and encouragement to employees to fulfill their potential

i. It helps in achieving higher productivity and organizational development

The essence of a progressive career development program is built on providing support

for employees to continually add to their skills, abilities, and knowledge. This support

from organisation includes:

a. Clearly communicating the organization’s goals and future strategies.

b. Creating growth opportunities.

c. Offering financial assistance.

d. Providing the time for employees to learn.

On the part of employees, they should manage their own careers like entrepreneurs

managing a small business. They should think of themselves as self-employed. They

should freely participate in career planning activities and must try to get as much as

possible out of the opportunities provided. The successful career will be built on

maintaining flexibility and keeping skills and knowledge up to date.

Career anchors

Some recent evidence suggests that six different factors account for the way people select

and prepare for a career. They are called career anchors because they become the basis

for making career choices. They are particularly found to play a significant role amongst

younger generation choosing professions. They are briefly presented below:

a. Managerial competence: The career goal of managers is to develop qualities of

interpersonal, analytical, and emotional competence. People using this anchor want

to manage people.

b. Functional competence: The anchor for technicians is the continuous development

of technical talent. These individuals do not seek managerial positions.

c. Security: The anchor for security-conscious individuals is to stabilize their career

situations. They often see themselves tied to a particular organization or

geographical location.

d. Creativity: Creative individuals are somewhat entrepreneurial in their attitude. They

want to create or build something that is entirely their own.

e. Autonomy and independence: The career anchor for independent people is a desire

to be free from organizational constraints. They value autonomy and want to be

their own boss and work at their own pace. This also includes an entrepreneurial

spirit.

f. Technological competence: There is a natural affinity for technology and a desire

to work with technology whenever possible. These individuals often readily accept

change and therefore are very adaptable.

Career Planning Process

It is obvious from the foregoing analysis that individuals differ a great deal in term of

their career orientation .The career orientation is influenced by the preference for a

particular career anchor, the life cycle stage, individual difference in values, goals,

priorities, and aspiration. Organization also on the other hand differ in term of career path

and opportunities that they can provide given the reality of their internal and external

environments .The career system available in organizational depend on their growth

potential, goals and priorities. The difference between what the employees look for in

their career progression and what career growth opportunities the organization is able to

provide, gives rise to situation of potential conflict. If the conflict is allowed to persist,

the employee will experience dissatisfaction and withdraw from being actively engaged

in the productive pursuit .They might even choose the option of leaving the organization.

In either case, the organization is not able to optimally utilize the potential contribution of

its employee towards the achievement of its goal.

The possibility of conflict between the individual-organization objective calls for career

planning efforts which can help identify areas of conflict and initiate such action as

necessary to resolve the conflict . Career planning thus involves matching of rewards and

incentives offered by the career path and career structure with hope and aspiration of

employees regarding their own concept of progression. A general approach to career

planning would involve the following steps:

a. Analysis of the characteristic of the reward and incentives offered by the

prevailing career system needs to be done and made know to employee .Many

individual may not be aware of their own career progression path as such

information may be confined to only select group of managers.

b. Analyse the characteristic of the hopes and aspirations of different categories of

employee including the identification of their career anchor must be done trough the

objective assignment. Most organization assume the career aspiration of individual

employee which need not be in tune with the reality .The individual may not have a

clear idea of their short and long term career and life goals , and may not be aware

of the aspiration and career anchor .

c. Mechanism for identifying congruence between individual career aspiration and

organizational career system must develop so as to enable the organization to

discuses cases of mismatch or incongruence. On the basis of analysis, it will be

necessary to compare and identify specific area of match and mismatch for different

categories of employee.

d. Alternative strategies for dealing with mismatch will have to be formulated. Some

of the strategies adopted by several organization include the following :

♦ change in the career system by creating new career path , new incentives ,new

rewards , by providing challenge trough job redesign opportunities for lateral

movement and the like

♦ change in the employees hopes and aspirations by creating new needs, new goals,

new aspiration or by helping the employees to scale down goal and aspiration that

are unrealistic or unattainable for one reason or the other.

♦ Seek new basis of integration, compromise or other form of mutual change on the

part of employee and organizational trough problem solving, negotiation or other

devices.

♦ A framework of career planning process aimed at integrating individual and

organizational needs is presented.

e. Reviewing career plans A periodic review of career plans is necessary to know

whether the plans are contributing to the effective utilization of human resources by

matching employee objectives to job needs. Review will also indicate to employee

in which direction the organizations is moving, what changes are likely to take place

and what skills are needed to adapt to the changing needs of the organization.

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.

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:

• Superannuation: Employees retiring because they reach a certain age.

• Resignation: Employees leaving their current job to join a new job

• Promotion: Employees moving upward in the hierarchy of the organization.

• Diversification: Employees being redeployed to new activities.

• Creation of new position: Employees getting placed in new positions at the

same level.

Succession can be from within or from outside the organization. Succession by

people from within gives a shared felling among employee that they can grow as the

organizational grows. Therefore organization needs to encourage the growth and

development with its employee. They should look inward to identify potential and

make effort to groom people to higher and varied responsibilities. In some

professionally run large organizations, managers and supervisor in every department

are usually asked to identify three or four best candidate to replace them in their jobs

should the need arise. However, the organization may find it necessary to search for

talent from outside in certain circumstance. For example, when qualified and

competent people are not available internally, when it is planning to launch a major

expansion or diversification programmes requiring new ideas etc.. Complete

dependence on internal source may cause stagnation for the organization. Similarly

complete dependence on outside talent may cause stagnation in the career prospects

of the individual within the organization which may in turn generate a sense of

frustration.

Succession planning provides managers and supervisors a step-by-step methodology

to utilize after workforce planning initiatives have identified the critical required job

needs in their organization. Succession planning is pro-active and future focused, and

enables managers and supervisors to assess, evaluate, and develop a talent pool of

individuals who are willing and able to fill positions when needed. It is a tool to meet

the necessary staffing needs of an organization/department, taking not only quantity

of available candidates into consideration, but also focusing on the quality of the

candidates, through addressing competencies and skill gaps.

References:

1. Aswathappa, K.: “Human Resource and Personnel Management”, Himalaya

Publishing House, New Delhi

2. Davar, Rustom: “The Human side of Management”,(1994) Progressive Corporation

3. Ghosh, P.: Personnel Administration in India, (1990)

4. Gupta, C.B., “Human Resource Management”(1997), Sultan Chand & Sons, New

Delhi

5. Jucius Micheal, J.: “Personnel Management”,(1995) Richard Irwin

6. Micheal, V.P.: “Human Resource Management and Human Relations” (1998),

Himalaya Publishing house, New Delhi

7. Monappa, Arun & Saiyadain, Mirza S.: “Personnel Management” (1996), Tata

McGraw-Hill, New Delhi

8. Saiyadain, Mirza S.: “Human Resource Management”(3rd Ed.),2003, Tata McGraw-

Hill, New Delhi

Performance Planning and Review

INTRODUCTION

Performance appraisal helps organizations to determine how

employs can help achieve the goals of organizations. It has two

important activities included in it. First has to do with determining

the performance and other with the process of evaluation.

a. Performance

What does the term performance actually mean? Employees are

performing well when they are productive. Productivity implies both

concern for effectiveness and efficiency, Effectiveness refers to goal

accomplishment. However it does not speak of the costs incurred in

reaching the goal. That is where efficiency comes in. Efficiency

evaluates the ratio of inputs consumed to outputs achieved. The

greater the output for a given input, the greater the efficiency. It is

mot desirable to have objective measures of productivity such as

hard data on effectiveness, number of units produced, or percent of

crimes solved etc and hard data on efficiency (average cost per unit

or ratio of sales volume to number of calls made etc.).

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In addition to productivity as measured in terms of effectiveness

and efficiency, performance also includes personnel data such as

measures of accidents, turnover, absences, and tardiness. That is a

good employee is one who not only performs well in terms of

productivity but also minimizes problems for the organisation by

being to work on time, by not missing days, and by minimizing the

number of work-related accidents.

b. Assessment

To evaluate is to assess to worth or value. Appraisals are

judgments of the characteristics, traits and performance of others.

On the basis of these judgments we assess the worth or value of

others and identify what is good or bad. In industry performance

appraisal is a systematic evaluation of employees by supervisors.

Employees also wish to know their position in the organization.

Appraisals are essential for making many administrative decisions:

selection, training, promotion, transfer, wage and salary

administration etc. Besides they aid in personnel research.

Performance Appraisal thus is a systematic and objective way of

judging the relative worth of ability of an employee in performing

his task. Performance appraisal helps to identify those who are

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performing their assigned tasks well and those who are not and the

reasons for such performance.

THE APPRAISAL PROCESS

Following Steps are involved in appraisal process:-

1. The appraisal process begins with the establishment of

performance standards. These should have evolved out of job

analysis and the job description. These performance standards

should also be clear and objective enough to be understood and

measured. Too often, these standards are articulated in some such

phrase as “a full day’s work” or “a good job.” Vague phrases tell us

nothing. The expectations a manager has in term of work

performance by the subordinates must be clear enough in their

minds so that the managers would be able to at some later date, to

communicate these expectations to their subordinates and

appraise their performance against these previously established

standards.

2. Once performance standards are established, it is necessary to

communicate these expectations. It should not be part of the

employees’ job to guess what is expected of them. Unfortunately,

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too many jobs have vague performance standards. The problem is

compounded when these standards are not communicated to the

employees. It is important to note that communication is a two-way

street. Mere transference of information from the manager to the

subordinate regarding expectations is not communication.

Communication only takes place when the transference of

information has taken place and has been received and understood

by subordinate. Therefore feedback is necessary. Hence the

information communicated by the manager has been received and

understood in the way it was intended.

3. The Third step in a appraisal process is measurement of

performance. To determine what actual performance is, it is

necessary to acquire information about it. We should be concerned

with how we measure and what we measure.

Four common sources of information are frequently used by

mangers to measure actual performance: personal observation,

statistical reports, oral reports, and written reports. Each has its

strengths and weaknesses; however, a combination of them

increases both the number of input sources and the probability of

receiving reliable information.

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What we measure is probably more critical to the evaluation

process than how we measure. The selection of the wrong criteria

can result in serious dysfunctional consequences. What we

measure determines, to a great extent, what people in a

organization will attempt to excel at. The criteria we choose to

measure must represent performance as stated in the first two

steps of the appraisal process.

4. The fourth step in the appraisal process is the comparison of

actual performance with standards. The attempt in this step is to

note deviations between standard performance and actual

performance. One of the most challenging tasks facing managers is

to present an accurate appraisal to the subordinate and then have

the subordinate accept the appraisal in a constructive manner. The

impression that subordinates receive about their assessment has a

strong impact on their self-esteem and, very important, on their

subsequent performance. Of course, conveying good news is

considerably less difficult than conveying the bad news that

performance has been below expectations. Thus, the discussion of

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the appraisal can have negative as well as positive motivational

consequences.

5. The final step in the appraisal is the initiation of corrective

action when necessary. Corrective action can be of two types; one is

immediate and deals predominantly with symptoms. The other is

basic and delves into causes. Immediate corrective action is often

described as “putting out fires”, where as basic corrective action

gets to the source of deviation and seeks to adjust the differences

permanently. Immediate action corrects something right now and

gets things back on track. Basic action asks how and why

performance deviated. In some instances, managers may rationalize

that they do not have the time to take basic corrective action and

therefore must be content to “perpetually put out fires.” In

summary the performance process has following steps:-

a. Establish performance standards.

b. Communicate performance expectations to employees.

c. Measure actual performance.

d. Discuss the appraisal with employees.

e. If necessary, initiate a corrective action.

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GOALS OF PERFORMANCE APPRAISAL

Conducting performance appraisals on employee’s performance

should be more than a simple checklist of Do’s and Don’ts.

Performance evaluation should serve as a vital component, one that

is of interest to both the organization and the employee. From the

organizational perspective, sound performance appraisals can

assure that correct work is being done, work that assists in

meeting department goals. In a simplistic rendition each employees

work should support the activities on his or her supervisor’s

performance objectives. This should ultimately continue up the

hierarchy, with all efforts supporting corporate strategic goals.

From the employee perspective, properly operating performance

appraisal systems provide a clear communication of work

expectations. Knowing what is expected is a first step in helping

one to cope better with the stress usually associated with a lack of

clear direction. Secondly, properly designed performance appraisals

should also serve as a means of assisting an employee’s personal

development.

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To make effective performance appraisals a reality, four criteria

need to be present. These are:

a. Employees should be actively involved in the evaluation and

development process.

b. Supervisors need to enter performance appraisals with a

constructive and helpful attitude.

c. Realistic goals must be mutually set.

d. Supervisors must be aware, and have knowledge of the

employee’s job and performance.

OBJECTIVES OF PERFORMANCE APPRAISAL

Performance appraisal has a number of specific objectives. These

are given below:-

a. To review past performance;

b. To assess training needs;

c. To help develop individuals;

d. To audit the skills within an organizations;

e. To set targets for future performance;

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f. To identify potential for promotion;

Some employees may believe that performance appraisal is simply

used by the organization to apportion blame and to provide a basis

for disciplinary action. They see it as a stick that management has

introduced with which to beat people. Under such situations a well

thought out performance appraisal is doomed to failure. Even if the

more positive objectives are built into the system, problems may

still arise because they may not all be achievable and they may

cause conflict. For Example, an appraise is less likely to be open

about any shortcomings in past performance during a process that

affects pay or promotion prospects, or which might be perceived as

leading to disciplinary action. It is therefore important that

performance appraisal should have specific objective. Not only

should the objectives be clear but also they should form part of the

organization’s whole strategy. Thus incorporating objectives into

the appraisal system may highlight areas for improvement, new

directions and opportunities.

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BENEFITS OF APPRAISAL

The benefits of an effective appraisal scheme can be summed up

under three categories. These are for the organization, for appraiser

and for appraisee.

1. For the Organizations: following benefits would accrue to the

organization.

a. Improved performance throughout the organization due to

more effective communication of the organization’s objectives

and values, increased sense of cohesiveness and loyalty and

improved relationships between managers and staff.

b. Improvement in the tasks performed by each member of the

staff.

c. Identification of ideas for improvement.

d. Expectations and long-term plans can be developed.

e. Training and development needs can be identified more

clearly.

f. A culture of continuous improvement and success can be

created and maintained.

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g. People with potential can be identified and career

development plans can be formulated for future staff

requirements.

2. For the appraiser: The following benefits would accrue to the

appraiser:-

a. The opportunity to develop an overview of individual jobs and

departments.

b. Identification of ideas for improvements.

c. The opportunity to link team and individual objectives and

targets with departmental and organizational objectives.

d. The opportunity to clarify expectations of the contribution the

manager expects from teams and individuals.

e. The opportunity to re-prioritize targets.

f. A means of forming a more productive relationship with staff

based on mutual trust and understanding.

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3. For the appraisee : for the appraisee the following benefits

would accrue.

a. Increased motivation.

b. Increased job satisfaction.

c. Increased sense of personal value.

APPRAISAL METHODS

This section looks at how management can actually establish

performance standards and devise instruments that can be used to

measure and appraise an employee’s performance. A number of

methods are now available to assess the performance of the

employees.

1. Critical Incident Method.

Critical incident appraisal focuses the rater’s attention on those

critical or key behaviors that make the difference between doing a

job effectively and doing it ineffectively. What the appraiser does is

write down little anecdotes that describe what the employee did

that was especially effective or ineffective. In this approach to

appraisal, specific behaviors are cited, not vaguely defined

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personality traits. A behaviorally based appraisal such as this

should be more valid than trait-based appraisals because it is

clearly more job related. It is one thing to say that an employee is

“aggressive” or “imaginative or “relaxed,” but that does not tell

anything about how well the job is being done. Critical incidents,

with their focus on behaviors, judge performance rather than

personalities. Additionally, a list of critical incidents on a given

employees provides a rich set of examples from which the employee

can be shown which of his or her behaviors are desirable and

which ones call for improvement. This method suffers from

following two drawbacks:-

a. Supervisor are reluctant to write these reports on a daily or

even weekly basis for all of their subordinates as it is time

consuming and burdensome for them

b. Critical incidents do not lend themselves to quantification.

Therefore the comparison and ranking of subordinates is

difficult.

2. Checklist

In the checklist, the evaluator uses a bit of behavioral descriptions

and checks of those behaviors that apply to the employee. The

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evaluator merely goes down the list and gives “yes” or “no”

responses. Once the checklist is complete, it is usually evaluated

by the staff of personnel department, not the rater himself.

Therefore the rater does not actually evaluate the employee’s

performance; he/she merely records it. An analyst in the personnel

department then scores the checklist, often weighting the factors in

relationship to their importance. The final evaluation can then be

returned to the rating manager for discussion with the subordinate,

or someone from the personnel department can provide the

feedback to the subordinate.

3. Graphic Rating Scale

One of the oldest and most popular methods of appraisal is the

graphic rating scale. They are used to assess factors such as

quantity and quality of work, job knowledge, cooperation, loyalty,

dependability, attendance, honesty, integrity, attitudes, and

initiative etc. However, this methods is most valid when abstract

traits like loyalty or integrity are avoided unless they can be defined

in more specific behavioral terms. The assessor goes down the list

of factors and notes that point along the scale or continuum that

list of factors and notes that point along the scale or continuum

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that best describes the employee. There are typically five to ten

points on the continuum. In the design of the graphic scale, the

challenge is to ensure that both the factors evaluated and the scale

pints are clearly understood and unambiguous to the rater. Should

ambiguity occur, bias is introduced. Following are some of the

advantages of this method:-

a. They are less time-consuming to develop and

administer.

b. They permit quantitative analysis.

c. There is greater standardization of items so

comparability with other individuals in diverse job

categories is possible.

4. Forced Choice Method

The forced choice appraisal is a special type of checklist, but the

rater has to choose between two or more statements, all of which

may be favorable or unfavorable. The appraiser’s job is to identify

which statement is most (or in some cases least) descriptive of the

individual being evaluated. To reduce bias, the right answers are

not known to the rater. Someone in the personnel department

scores the answers based on the key. This key should be validated

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so management is in a position to say that individuals with higher

scores are better-performing employees. The major advantages of

the forced choice method are:-

a. Since the appraiser does not know the “right” answers, it

reduces bias.

b. It looks at over all performance.

c. It is based on the behavior of the employees.

5. Behaviorally Anchored Rating Scales

These scales combine major elements from the critical incident and

graphic rating scale approaches: The appraiser rates the employees

based on items along continuum, but the points are examples of

actual behavior on the given job rather than general descriptions or

traits. Behaviorally anchored rating scales specify definite,

observable, and measurable job behavior. Examples of job-related

behavior and performance dimensions are generated by asking

participants to give specific illustrations on effective and ineffective

behavior regarding each performance dimension. These behavioral

examples are then retranslated into appropriate performance

dimensions. Those that are sorted into the dimension for which

they were generated are retained. The final group of behavior

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incidents are then numerically scaled to a level of performance that

each is perceived to represent. The incidents that are retranslated

and have high rater agreement on performance effectiveness are

retained for use as anchors on the performance dimension. The

results of the above processes are behavioral descriptions, such as

anticipates, plans, executes, solves immediate problems, carries

out orders, and handles emergency situations.

This method has following advantages:

a. It does tend to reduce rating errors.

b. It assesses behavior over traits.

c. It clarifies to both the employee and rater which behaviors

connote good performance and which connote bad.

6. Group Order Ranking

The group order ranking requires the evaluator to place employees

into a particular classification, such as “top one-fifth” or “second

one-fifth.” Evaluators are asked to rank the employees in the top 5

percent, the next 5 percent, the next 15 percent. So if a rater has

twenty subordinates, only four can be in the top fifth and, of

course, four must also be relegated to the bottom fifth. The

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advantage of this method is that it prevent raters from inflating

their evaluations so everyone looks good or from homogenizing the

evaluations for everyone is rated near the average outcome that are

usual with the graphic rating scale. It has following disadvantage:-

a. It is not good if the number of employee being compared is

small. At the extreme, if the evaluator is looking at only four

employees, it is very possible that they may all be excellent,

yet the evaluator may be forced to rank them into top

quarter, second quarter, third quarter, and low quarter!

b. Another disadvantage, which plagues all relative measures,

is the “zero-sum game”: consideration. This means, any

change must add up to zero. For example, if there are twelve

employees in a department performing at different levels of

effectiveness, by definition, three are in the top quarter,

three in the second quarter, and so forth. The sixth-best

employee, for instance, would be in the second quartile.

Ironically, if two of the workers in the third or fourth

quartiles leave the department and are not replaced, then

our sixth best employee now fit into the third quarter.

c. Because comparison are relative, an employee who is

mediocre may score high only because he or she is the “best

18

of the worst” Similarly, an excellent performer who is

matched against “stiff” competition may be evaluated poorly,

when in absolute terms his or her performance is

outstanding.

7. Individual Ranking

The individual ranking method requires the evaluator merely to list

all the employees in an order from highest to lowest. Only one can

be the “best.” If the evaluator is required to appraise thirty

individuals ranking method carries the same pluses and minuses

as group order ranking.

8. Paired comparison

The paired comparison method is calculated by taking the total of

[n (n-1)]/2 comparisons. A score is obtained for each employee by

simply counting the number of pairs in which the individual is the

preferred member. It ranks each individual in relationship to all

others on a one-on-one basis. If ten people are being evaluated, the

first person is compared, with each of the other nine, and the

number of items this person is preferred in any of the nine pairs is

tabulated. Each of the remaining nine persons, in turn, is

19

compared in the same way, and a ranking is evolved by the greatest

number of preferred “victories”. This method ensures that each

employee is compared against every other, but the method can

become unwieldy when large numbers of employees are being

compared.

9. Management By Objectives

Management by objectives (MBO) is a process that converts

organizational objectives into individual objectives. It can be

thought of as consisting of four steps: goal setting, action planning,

self-control, and periodic reviews:-

a. In goal setting, the organization’s overall objectives are used

as guidelines from which departmental and individual

objectives are set. At the individual level, the manager and

subordinate jointly identify those goals that are critical for the

subordinate to achieve in order to fulfill the requirements of

the job as determined in job analysis. These goals are agreed

upon and then become the standards by which the

employee’s results will be evaluated.

20

b. In action planning, the means are determined for achieving

the ends established in goals setting. That is, realistic plans

are developed to attain the objectives. This step includes

identifying the activities necessary to accomplish the

objective, establishing the critical relationships between these

activities, estimating the time requirement for each activity,

and determining the resources required to complete each

activity.

c. Self-control refers to the systematic monitoring and

measuring of performance. Ideally, by having the individual

review his or her own performance. The MBO philosophy is

built on the assumptions that individuals can be responsible,

can exercise self-direction, and do not require external

controls and threats of punishment.

d. Finally, with periodic progress reviews, corrective action is

initiated when behavior deviates from the standards

established in the goal-setting phase. Again, consistent with

MBO philosophy, these manager-subordinate reviews are

conducted in a constructive rather than punitive manner.

Reviews are not meant to degrade the individual but to aid in

21

future performance. These reviews should take place at least

two or three times a year.

Following are the advantages of MBO:-

a. It is result –oriented. It assists the planning and control

functions and provides motivation.

b. Employees know exactly what is expected of them and how

they will be evaluated.

c. Employees have a greater commitment to objectives that they

have participated in developing than to those unilaterally set

by their bosses.

10. 360 degree appraisal

Many organizations have expended the idea of upward feedback

into what they call 360 degree appraisal. Here performance

information is collected all around from his or her supervisors,

subordinates, self, peers and internal or external customers. The

feedback is generally used in training and development rather than

pay increase. The individualized reports are presented to person

being rated. They then meet with their own supervisor and

22

sometimes with their subordinates and share the information they

feel is relevant for the purpose of developing a self improvement

planed.

PERFORMANCE COUNSELING AND POTENTIAL

APPRAISAL

The main objective of performance counseling is to help the

employee to overcome his weaknesses and to reinforce his

strengths. In this sense it is a developmental process where the

supervisor and the subordinate discuss the past performance with

a view to help the subordinate to improve and become more

effective in future. Appraisal reports serve as spring board for

discussion. One of the fallout effects of this dyadic interaction is

the identification of training needs. Counseling provides an

opportunity to the supervisor to give feedback to the subordinate

on the performance and performance related behavior. Feedback

can be an effective tool provided:

a. Both negative and positive feedbacks are communicated.

b. It is not just an opinion but is backed by data. In other words

it should be descriptive and not evaluative.

c. It focuses on behavior rather than on the individual.

23

d. It is timely. Delayed feedback is neither helpful nor effective.

On the other hand, it might be seen as criticism which may

further deteriorate the relationship. As time passes, details

are forgotten and recall may be jeopardized by distortions.

Several conditions for effective counseling are identified. The

Following are some of the important ones:-

a. A climate of openness and trust is necessary. When people

are tense and hostile, attempts should be made to counsel

and help rather than be critical.

b. The counselor should be tactful and helpful rather than

critical and fault finding.

c. The subordinate should feel comfortable to participate

without any hesitation or inhibition.

d. The focus should be on the work-related problems and

difficulties rather than personality or individuals likes,

dislikes or idiosyncrasies.

e. It should be devoid of all discussions on salary, reward and

punishment. Any discussion on compensation changes the

focus from performance improvement to the relationship

between performance and reward.

24

Since counseling is a difficult activity, the supervisor should be

specially trained is social competence to handle these aspects of his

job. The skill required to do well in these situations is often referred

to as the use of non-directive technique. It is a methodology of

generating information and using this information to help

employees. A sample of non-directive technique could be to start

the interview by asking “tell me how you think you are doing”. This

provides an environment for the subordinate to talk about his part

of the story first. The essential feature is to provide an employee an

opportunity to talk and share his experience which the supervisor

should be able to listen and then process and provide feedback to

him.

Many supervisors are hesitant to initiate performance counseling

sessions because the subordinates may raise uneasy questions for

which they may not have answers. Or they may question their

judgments and decisions which may lead to argument, debate and

misunderstanding. That is why there is a need to train supervisors

in the techniques of counseling sessions.

One major outcome of performance counseling is identification of

the potential of the employee’s skills and abilities not known and

25

utilized by the organization. Potential appraisal is different from

performance appraisal as the latter limits evaluation to what the

subordinate has done on the job (or his performance) whereas the

former on the other hand, seeks to examine what it that the

subordinate can do is. The distinct advantage of a thoroughly

carried out potential appraisal are given below:-

a. The organizations are able to identify individuals who can

take higher responsibilities.

b. It also conveys the message that people are not working in

dead-end jobs in the organization.

CAREER PATH

One of the important objectives of appraisal, particularly potential

appraisal is to help employees to move upwards in the

organization. People do not like to work on dead-end jobs. Hence, a

career ladder with clearly defined steps becomes an integral

component of human resources management. Most HRM

practitioners favor restructuring of a job to provide reasonably long

and orderly career growth. Career path basically refers to

opportunities for growth in the organization. Availability of such

opportunities has tremendous motivational value. It also helps in

26

designing salary structures, identifying training needs and

developing second line in command. Career paths can be of two

kinds:

a. Those where designations changes to a higher level position,

job remaining more or less the same. A good example of this

is found in teaching institutions, where an assistant professor

may grow to became associate professor and a professor, but

the nature of job (teaching and research) remains the same.

Career path in such situations means a change in status,

better salary and benefits and perhaps less load and better

working condition.

b. Those where changes in position bring about changes in job

along with increased salary, status and better benefits and

working conditions. In many engineering organizations, an

employee may grow in the same line with increased

responsibilities or may move to other projects with different

job demands.

One important mechanism to identify the promotability of

employees is Assessment Centre. It is a method which uses a

27

variety of technique to evaluate employees for manpower

requirements in the organization. It uses situational tests including

exercises requiring participants to prepare written reports after

analyzing management problem, make oral presentations, answer

mail or memo in in-basket situation and a whole lot of situational

decision making exercises. Assessors observe the behavior and

make independent reports of their evaluation of the strengths and

weaknesses of the attributes being studied.

PROBLEMS IN APPRAISAL

While it is assumed that performance appraisal process and

techniques present an objective system it would be naïve to

assume, however, that all practicing managers impartially interpret

and standardize the criteria upon which their subordinates will be

appraised. In spite of our recognition that a completely error-free

performance appraisal can only be idealized a number of errors

that significantly impede objective evaluation. Some of these errors

are discussed below:-

28

1. Leniency Error

Every evaluator has his/her own value system that acts as a

standard against which appraisals are made. Relative to the true or

actual performance an individual exhibits, some evaluators mark

high and others low. The former is referred to as positive leniency

error, and the latter as negative leniency error. When evaluators are

positively lenient in their appraisal, an individual’s performance

becomes overstated; that is rated higher than it actually should.

Similarly, a negative leniency error understates performance, giving

the individuals as lower appraisal.

2. Halo Effect

The halo effect or error is a tendency to rate high or low on all

factors due to the impression of a high or low rating on some

specific factor. For example, if an employee tends to be

conscientious and dependable, the supervisor might become biased

toward that individual to the extent that he will rater him/her high

on many desirable attributes.

29

3. Similarity Error

When evaluators rate other people in the same ways that the

evaluators perceive themselves they are making a similarity error.

Based on the perception that evaluators have of themselves, they

project those perceptions onto others. For example, the evaluator

who perceives him self or herself as aggressive may evaluate others

by looking for aggressiveness. Those who demonstrate this

characteristic tend to benefit, while others are penalized.

4. Low Appraiser Motivation

What are the consequences of the appraisal? If the evaluator knows

that a poor appraisal could significantly hurt the employee’s future

particularly opportunities for promotion or a salary increase the

evaluator may be reluctant to give a realistic appraisal. There is

evidence that it is more difficult to obtain accurate appraisals when

important rewards depend on the results.

5. Central Tendency

It is possible that regardless of whom the appraiser evaluates and

what traits are used, the pattern of evaluation remains the same. It

is also possible that the evaluator’s ability to appraise objectively

30

and accurately has been impeded by a failure to use the extremes

of the scale, that is, central tendency. Central tendency is the

reluctance to make extreme ratings (in either directions); the

inability to distinguish between and among ratees; a form of range

restriction.

6. Recency Vs. Primacy Effect

Recency refers to the proximity or closeness to appraisal period.

Generally an employee takes it easy for the whole year and does

little to get the punishment. However, comes appraisal time, he

becomes very active. Suddenly there is an aura of efficiency, files

move faster, tasks are taken seriously and the bosses are

constantly appraised of the progress and problems. All this creates

an illusion of high efficiency and plays a significant role in the

appraisal decisions. The supervisor gets railroaded into believing

that the employee is alert and hence, rates him high. In reality

through it refers only to his two to three month’s performance.

The opposite of recency is primancy effect. Here the initial

impression influences the decision on year end appraisal

irrespective of whether the employee has been able to keep up the

31

initial impression or not. First impression is the last impression is

perhaps the most befitting description of this error.

EFFECTIVE PERFORMANCE APPRAISAL

The issues raised above essentially focus on the problems of

reliability and validity of performance appraisal. In other words,

how do we know whether what is appraised is what was supposed

to be appraised. As long as appraisal format and procedure

continues to involve subjective judgment, this question cannot be

fully answered and perhaps, will not be answered completely

because no matter how objective a system is designed it will

continue to be subjective. Perhaps, the following steps can help

improve the system.

a. The supervisors should be told that performance appraisal is

an integral part of their job duties and that they themselves

would be evaluated on how seriously they have taken this

exercise.

b. To help them do this task well, they should be provided

systematic training on writing performance reports and

handling performance interviews.

32

c. Conduct job evaluation studies and prepare job

descriptions/roles and develop separate forms for various

positions in the organization.

d. Design the system as simple as possible so that it is neither

difficult to understand nor impossible to practice

e. Generally after the appraisal interview the employee is left

alone to improve his performance on the dimensions. The

supervisor should monitor now and then whether the

improvement in performance in the areas found weak is

taking place or not and, if not, help the employee to achieve

the required improvement.

f. Finally, reviewing, the appraisal systems every now and then

help updating it, and making suitable evolutionary changes in

it. This is the most important factor in making performance

appraisal effective. As time passes changes in technology and

work environment necessitate changes in tasks, abilities and

skills to perform these tasks. If changes in the format are not

incorporated the reports may not generate the kind of date

needed to satisfy appraisal objectives.

33

In addition, following can also help in improving the effectiveness of

an appraisal

Behaviorally Based Measures

The evidence strongly favors behaviorally based measures over

those developed around traits. Many traits often considered to be

related to good performance may, in fact have little or no

performance relationship. Traits like loyalty, initiative, courage,

reliability, and self-expression are intuitively appealing as desirable

characteristics in employees. But the relevant question is, Are

individuals who are evaluated as high on those traits higher

performers than those who rate low? Traits like loyalty and

initiative may be prized by managers, but there is no evidence to

support that certain traits will be adequate synonyms for

performance in large cross-section of jobs. Behaviorally derived

measures can deal with this objection. Because they deal with

specific examples of performance-both good and bad, they avoid the

problem of using inappropriate substitutes.

34

Ongoing Feedback

Employees like to know how they are doing. The annual review,

where the manager shares the subordinates evaluations with them,

can become a problem. In some cases, it is a problem merely

because managers put off such reviews. This is particularly likely if

the appraisal is negative. The solution lies in having the manager

share with the subordinate both expectations and disappointments

on a day-today basis. By providing the employee with frequent

opportunities to discuss performance before any reward or

punishment consequences occur, there will be no surprises at the

time of the annual formal review. In fact, where ongoing feedback

has been provided, the formal sitting down step should not be

particularly traumatic for either party.

Multiple Raters

As the number of raters increase, the probability of attaining more

accurate information increases. If rater error tends to follow a

normal curve, an increase in the number of raters will tend to find

the majority congregating about the middle. If a person has had ten

supervisors, nine having rated him or her excellent and one poor,

we can discount the value of the one poor evaluation.

35

Peer Evaluations

Periodically managers find it difficult to evaluate their subordinates’

performance because they are not working with them every day.

Unfortunately, unless they have this information, they may not be

making an accurate assessment. One of the easiest means is

through peer evaluations. Peer evaluations are conducted by

employees’ co-workers, people explicitly familiar with the jobs

involved mainly because they too are doing the same thing, they

are the ones most aware of co-workers’ day to-day work behavior

and should be given the opportunity to provide the management

with some feedback.

The main advantages to peer evaluation are that (a) there is

tendency for co-workers to offer more constructive insight to each

other so that, as a unit, each will improve; and (b) their

recommendations tend to be more specific regarding job behaviors-

unless specificity exists, constructive measures are hard to gain.

36

References:

1. Dessler, Gary, (2002) Human Resource Management Delhi.

Pearson Education, Pvt. Ltd.

2. Fisher, Martin(1996) Performance Appraisals London: Kogon

Page.

3. Robbins, Stephen P., De Cenzo, David. A(1993) Human

Resource Management New Delhi, Prentice Hall of India Pvt.

Ltd.

4. Rao, T.V.(2004) Performance Management and Appraisal

Systems HR Tools for global competitiveness New Delhi,

Response Books.

5. Saiyadain, Mirza S. (2003) Human Resource Management

(3rd Edition) New Delhi Tata McGraw Hill Publishing

Company Limited.

37

Job Analysis and
UNIT 4 JOB ANALYSIS AND JOB DESIGN Job Design

Objectives
l define Job Analysis (JA);
l understand the process of JA;
l discuss the methods of JA;
l discuss the concept of Job Description and Job Specification;
l identify techniques of collecting information for JA; and
l describe the process of Job Design and effects of work flow on people.

Structure
4.1 Introduction
4.2 Purpose and Definition of Job Analysis
4.3 The Focus of Job Analysis: Positions and Jobs
4.4 The Importance of Job Analysis
4.5 Methods of Job Analysis
4.6 Job Description and Job Specification
4.7 Techniques of Collecting Information for Job Analysis
4.8 Techniques of Writing Job Descriptions
4.9 Job Design
4.10 Effects of Work Flow on People
4.11 Different Work Systems
4.12 The Current Picture
4.13 Summary

4.1 INTRODUCTION
Emerging from years of downsizing and restructuring, and with a new appreciation
for the value of their human resources, many organizations are moving rapidly to
embrace a new approach to the management of human resource (HR) process. Job
analysis helps to understand the qualities needed by employees, defined through
behavioral descriptors, to provide optimum work performance. These qualities range
from personality characteristics and abilities to specific skills and knowledge.
By linking HR activities through a common language and framework, by reflective the
values and mission of the organization and by establishing clear expectations of
performance for employees integrates HR practices, defines business strategy of the
organization and maximizes the delivery of its services to clients.
The critical role of modern job analysis is in guiding, learning and development at
activities of employees. Modern Job analysis address development through the 5

Getting Human provision of tools for employees that address:
Resources
l What it takes to do a job;
l What an individual brings to the job; and
l What the gaps (learning and development needs) are.
The purpose of this input is to clearly define the context and status of Job Analysis as
an HR approach, situate its use within the organization and describe the issues that
need to be addressed with respect to its growing application across departments and
agencies.
It is hoped that this unit will serve as the common platform on the basis of which key
decisions can be taken by departments, agencies to ensure a more collaborative and
focused approach to the implementation.

4.2 PURPOSE AND DEFINITION OF JOB ANALYSIS
Job analysis is the fundamental process that forms the basis of all human resource
activities. The importance of job analysis has been well-established for years, dating
back to at least the First World War. The United States government’s Uniform
Guidelines on Employee Selection Procedures (1978) and the American Psychological
Association’s Principles for the Validation and use of Personnel Selection Procedures
stipulate that job analysis is essential to the valediction of any and all major human
resources activities.
In its simplest terms, a job analysis is a systematic process for gathering, documenting
and analyzing date about the work required for a job. The data collected in a job
analysis, and reflected through a job description, includes a description of the context
and principal duties of the job, and information about the skills, responsibilities,
mental models and techniques for job analysis. These include the Position Analysis
Questionnaire, which focuses on generalized human behaviors and interviews, task
inventories, functional job analysis and the job element method.
A job analysis provides an objective picture of the job, not the person performing the
job, and as such, provides fundamental information to support all subsequent and
related HR activities, such as recruitment, training, development, performance
management and succession planning. Job analysis serves two critical functions with
respect to these processes. Job analysis helps ensure that decisions made with respect
to HR processes are good decisions i.e., fair and accurate (e.g., selection of the right
person for the job, appropriate decisions about training, performance management,
development, etc.) and its helps ensure the defensibility of decisions made to employee
(resulting in good HR management) and to the courts (resulting in saving of costs,
time and reputation).

4.3 THE FOCUS OF JOB ANALYSIS :
POSITIONS AND JOBS
The unit of study in job analysis may be position or a job. A “position” is the most
basic structural entity in the organization, representing the collection of duties
assigned to a single person. One or more similar positions, each of which is
interchangeable with the others in terms of work activities, makes up a “job.” In fact,
a “job” has been defined (Henderson, 1979) as “work consisting of responsibilities
and duties that are sufficiently a like to justify being covered by a single job analysis.”
It has also been defined as “a collection of position similar enough to one another in
terms of their work behaviors to share a common job title “(Harvey, 1991). The
linkage positions in an organization provides a roadmap and tool for translating the
6 organization’s mission, values and business priorities into results.

Why is there a need to talk in terms of positions or jobs? It is because it is necessary Job Analysis and
to identify the results individual will be accountable for when they are hired, how their Job Design
work fits in or relates to other work performed in the organization, how their work
should be compensated for in relation to that of others, on what basis recruitment and
training should be carried out, and so on.

4.4 THE IMPORTANCE OF JOB ANALYSIS
According to scientific management, the key to productivity is a precise understanding
of the tasks that constitute a job. If the motions of workers are to become
standardized and machine-like, then it is necessary to be certain about what is to be
accomplished, as well as what abilities and materials are necessary to do the job. For
many years, job analysis was considered the backbone of the scientific clipboards and
stopwatches, was the method used to determine the most efficient way to perform
specific jobs.
As the popularity of scientific management declined after World War II, however, so
did the popularity of job analysis. With the new emphasis on human relations as the
key to productivity job analysis was used primarily to set salary scales. But in the
modern times workers and employers began to take renewed interest in this area
because of concerns about two issues: unfair discrimination and comparable worth.
There are two areas where unfair discrimination in hiring can occur: in the standards
set for being hired; and in the procedures used to assess the applicant’s ability to meet
those standards. Job analysis addresses the question of what tasks, taken together
actually constitute a job. Without this information, standards for hiring may appear to
be arbitrary – or worse, designed to exclude certain individual or groups from the
workplace.
More recently, the issue of comparable worth has also contributed to a new interest in
job analysis. Comparable worth refers to equal pay for individuals who hold different
jobs but perform work that is comparable in terms of knowledge required or level of
responsibility. The major issue of the comparable worth controversy is that women
who are employed in jobs that are comparable to those held by men are paid, on the
average, about 65 percent of what a man would earn. In order to determine the
comparability of job tasks so that salaries can also be compared, a proper job analysis
is necessary. Comparable work is an issue of considerable interest to many people.

4.5 METHODS OF JOB ANALYSIS
Job analysis is the procedure for identifying those duties or behaviors that define a
job. Aside from verifying the fairness of selection procedures, job analysis is the
foundation of virtually every other area of industrial psychology, including
performance appraisal, training and human factors. Additionally, job analysis is the
basis of job evaluation, the procedure for setting salary scales. Figure 1 suggests some
of the many uses of job analysis.
Information about jobs can be collected in a number of ways. McCormick (1976) lists
the following as potential sources: observation, individual interview, group interview,
technical conference, questionnaire, diary, critical incidents, equipment design
information, recording of job activities, or employee records. Possible agents to do the
collecting are professional job analysis, supervisors, job incumbents, or even a camera
in the work-place.
Inspite of both its importance and the availability of data, however, the area of job
analysis has not been studies in details. One reason for the lack of research is the
7

Getting Human nature of the data: Although qualitative information about jobs, collected through
Resources observations, is plentiful, translating this data into a quantitative form amenable to
statistical analysis is often difficult.
Over time, different approaches to dealing with data of job description have been
developed. Some method designed to study jobs include functional job analysis (Fine,
1974), critical incidents (Flanagan, 1954), job elements (Primoff, 1975) the Position
Analysis Questionnaire (McCormick, Jeanneret, & Mecham, 1972), and the physical
abilities requirement approach (Fleishman, 1975).

DESIGNING THE JOB
l Meet production goals
l Promote job mobility / career ladders

s
l Create entry level jobs
l Remove artificial barriers to
employment of special groups

s

MANAGING PERFORMANCE CLASSIFYING / EVALUATING
l Promote, award, increase salary l Written description of job content,
l Discipline, terminate requirements, and context
l Provide additional training l Identification of critical job
l Restructure job requirements
l Assessment of job in relation to
others to determine pay
s

s

APPRAISING PERFORMANCE RECRUITING
l Identification of critical job l Clear statement of job content,
elements requirements, and context
l Development of performance l Identification of appropriate
standards recruiting sources
l Identification of performance
indicators
s

s

TRAINING STAFFING
l Identification of competencies l Identification of minimum
needed for successful job qualifications
performance l Identification of special
l Identification for organization- selection factors.
based competencies l Development of valid selection
l Development of relevant instruments and procedures
curricula for classroom and
on-the-job training
s

Figure 1. Human Resource Management Cycle: Application of Job Analysis Data.
Source: Bemis, S.E. Belenky, A.H, Soder, D.A. (1983). Job Analysis: An effective
8 management tool. Washington, DC: Bureau of National Affairs

a) Functional Job Analysis Job Analysis and
Job Design
The rationale behind functional job analysis (FJA) is that jobs must be defined in
terms of the interaction between the task, the individuals responsible for
accomplishing the task, and the environment in which the task is to be performed. FJA
was developed by Sidney A. Fine during the 1950s as part of the Functional
Occupational Classification Project that resulted in the third edition of the Dictionary
of Occupational Titles. As well as providing a system that identifies job tasks,
functional job analysis also allows for the setting of performance standards and the
identifications of materials for training workers.
FJA relies on trained professionals for its data. These professions use employee
materials, training manuals, workers interviews, and direct observation to learn about
a specific job. According to Fine (1974), these analysis study jobs in terms of five
components. First, the purpose, goals and objectives of a specific job need to be
identified, and second, analysis must identify and describe the tasks necessary to
accomplish a job. In the third component of functional job analysis, the analysts
determine the specific abilities necessary to perform the job successfully. In this stage
of the analysis, jobs are reviewed along seven dimensions:
1) Data (worker’s involvement with information and ideas);
2) People (communication and interaction);
3) Things (use of machines and tools);
4) Amount of autonomy in the tasks;
5) Reasoning (the use of concepts and decision making);
6) Mathematics; and
7) Language (reading, writing, and speaking).
Fourth, from this information, performance standards are set and then, fifth, training
needs are identified in the final stages of functional job analysis.

Example of Functional Job Analysis
Olson et al. (1981) utilized a functional job analysis approach to study the work of
heavy equipment operators that has been described as a model application of this
method. Some workers had complained that the standards necessary to be hired—a
high school diploma, language and mathematics tests, and a four-year
apprenticeship—were to strict, often irrelevant to job performance, and excluded a
disproportionate number of minority candidates. The union representing heavy
equipment operators consequently authorized a job analysis to better understand the
actual work of its members and to assess the relevancy of its selection criteria.
After clarifying the goals and objectives of the job, the analysis developed seven task
statements for successful operation of a piece of heavy equipment. The basic tasks of
heavy equipment operation were identified as follows:
i) Inspects of equipments (prior to operation);
ii) Services the equipment;
iii) Starts the equipment;
iv) Operates the equipment – basic, low difficulty, outputs;
v) Operates the equipment – intermediate difficulty outputs;
vi) Operates the equipments – difficult outputs; and
vii) Shuts down the equipment.
9

Getting Human From the seven basic task statement, performance standards – more specific tasks
Resources within the broader category – were developed by groups of four to six subject matter
experts or “SMEs” (SMEs are typically supervisors, job incumbents, or job analysts).
Performance standards are expressed in terms of specific outputs and operator
behaviors necessary to accomplish those outputs. The number of performance
standards for any specific job can run into the thousands.
At this stage of the analysis, the researchers had enough data to develop a test for
assessing the abilities of heavy equipments operators. The analysts selected a few of
the performance standards and assembled them into a work sample test designed to be
a new standard for selecting operators. Table 1 lists some of the outputs tested. Scores
from the work sample tests developed from the functional job analysis resulted in the
successful prediction of the performance levels of heavy equipment operators. That is,
individuals who had been identified by a committee of supervisors as having a high
level of skill scored high on the work sample test, whereas those having a low level of
skill did not do as well.

Table 1: Outputs Tested for Each Piece of Equipment

Bulldozer (3 hours) Excavate for foundation, backfill
Finish the Slope
Push load scraper, run fill
Cut and fill, build ramp
Backhoe (2 hours) Excavate vertical wall trench
Expose buried pipe
Excavate sloping wall trench
Excavate pier hole
Loader (1 ½ hours) Excavate basement
Form spoil pile
Load haul vehicle from spoil stockpile
Grader (2 ½ hours) Build maintenance road
Cut rough ditches
Level material and crown road
Construct V-ditch to grade
Finish grade to a flat surface
Scraper (varied) Load scraper
Haul material to fill area
Unload scraper
Return to cut area

Source: Olson, H.C., Fine, S.A,. Myers, D.C, & Jennings, M.C. (1981). The use of
functional job analysis in establishing performance standards for heavy
equipment operators. Personal Psychology, 34, 351-364.

1 0

Evaluating Functional Job Analysis Job Analysis and
Job Design
From the foregoing analysis, it is easy to see that FJA yields an extremely detailed
picture of what tasks constitute a specific job. Such detailed information can be used
to identify erroneous and possibly damaging assumptions about job tasks: In the
example just cited, FJA resulted in a major revision of employee selection procedures.
At the same time FJA also required a major commitment in terms of resources.
Studying jobs, identifying tasks, developing performance standards, and testing
operators involves large numbers of personnel in a major effort. For smaller
organizations in particular, this approach may be too burdensome to be useful.
Another consideration with regard to FJA is its use of “experts” to analyse jobs. Since
some of the experts are individuals who do not actually perform the tasks, it is
possible that they may not have a full understanding of the job in question. On the
other hand, the job incumbents may also introduce error into the analysis if they do
not understand the importance of all, the components of a job.

b) Critical Incidents Technique
In contrast to FJA, where experts make judgments about the content of job, the critical
incidents technique (CIT) utilize actual episodes of on-the-job behaviour. This job
analysis method grew out of experiences with selecting candidates for flight school
during World War II. Standards for acceptance or rejection were lax, and vague
reasons such as “lack of inherent flying ability” were used to disqualify individuals
who might have been good crew members.
In an attempt to avoid relying on the impressions of examiners to assess the suitability
of candidates, the Air Force Aviation Psychology Program developed a series of
standards for performance using examples of behaviour that had occurred in military
situations. These “critical incidents” were defined as “extreme behaviour, either
outstandingly effective or ineffective with respect to attaining the general aims of the
activity” (Flanagan, 1954). In other words, CIT asks employees aims of the activity”
(Flanagan, 1954). In other words, CIT asks employees for specific examples of on-
the-job behaviour that demonstrate both high and low levels of performance.
Sources for critical incidents include workers, co-workers, supervisors, managers, and
others. Typically, the job analyst will ask informant’s to think of the most recent
example of a worker performing at a very high level. Informants will describe what
led to the incident, exactly what the employee did, the perceived consequences of the
behaviour, and whether or not these consequences were within the control of the
employee. (See Box 1).
Box 1
An example of a critical incident for a waiter might be as follows:
When a waiter and a waitress walked off the job during lunchtime, Johan was left
alone to serve a restaurant full of customers. Under incredible pressure, he waited
on tables throughout the room rather than only in his own section. He moved
quickly and efficiently and kept a pleasant smile on his face the entire time. As a
result, customers experienced only minimal delays in getting their food.

One advantage to the critical incident approach is that it can be used to gather large
amounts of data in a short period of time. Workers are assembled in groups and asked
to come up with incidents. According to Flanagan, an analysis of simple jobs would
require from 50 to 100 incidents, skilled and semi-skilled jobs would require from
1000 to 2000 incidents, and supervisory jobs would require from 2000 to 4000.
1 1

Getting Human After the incidents are collected, they are transferred to index cards, and job
Resources incumbents, supervisors, or analysts independently group similar incidents into
broader categories. (Factor analysis is frequently used in this part of the analysis).
These independent groupings are compared in order to establish categories may
include “promptness of service,” “accuracy of orders,” or ‘interaction with
customers.” Raters discuss any differences in categorization in order to ensure
agreement and the reliability of the ratings. From this procedure, a detailed outline of
the content of a specific job will emerge.

Example of Critical Incidents Techniques
Aamodt and his associates (1981) used the critical incidents techniques to study
successful and unsuccessful performance on the part of dormitory resident assistants
(RAs). The researchers asked 93 RAs, head residents, and assistant head residents the
following question:
Think of the best (worst) Resident Assistant that you have ever known. Now describe
in details one incident that reflects why this person was the best (worst).
Three judges sorted the 312 incidents collected into the following categories:
availability, fairness, discipline, self-confidence, interest in residents, authoritarianism,
social skills, self-control, and self-adherence to the rules. After resorting the incidents
as a check on the reliability of the raters’ judgments, the researchers were able to
identify qualities of good and poor resident assistants. Good RAs were fair in
discipline, concerned about residents, planned additional programs, stayed around the
hall more than was required, and were self-confident and self-controlled. Poor resident
assistants, on the other hand, were seldom around the hall, disciplined residents but
not their friends, broke rules, were not friendly, and had a personality style that was
either excessively timid or authoritarian.

Evaluating Critical Incidents Technique
Some authors have pointed out that one weakness of virtually all approaches to job
analysis is their reliance at some time point on the opinions of a knowledgeable
individual (e.g., Jones et al., 1982). In the critical incidents approach, this reliance of
actual instances is at least focused on events that actually happen in the workspace.
Reports of actual instances of behaviour gathered from a variety of sources may give
the critical incidents analyst a more objective picture of what behaviour constitute a
specific job. Supervisors are likely to be best informed about what levels of
performance are expected, and job incumbents are probably the critical incidents
technique, experts information is replaced by information from the workers.
Another important advantage of critical incident is that the data can be used for a
number of other personnel functions, especially in performance appraisal, job design,
human factors, and others areas.
On the other hand a disadvantage of this approach relates to one of its most attractive
features — the use of employees as the source of data. Asking employees to stop
work in order to meet in groups and record incidents that have accrued in the
workspace is time-consuming expensive, and inefficient. It may have a negative effect
on productivity. In a study comparing various methods of job analysis, Levine, Ash,
and Bennett (1980) found CIT to be the most expensive.
In order for CIT be effective, unfortunately, this process cannot be shortened. If an
insufficient number of incidents is collected, some aspects of jobs may be overlooked,
or only the most important tasks may be identified (Bemis et al., 1983).
Along the same lines, another problem with CIT is the subjective nature of the data.
1 2 Workers’ perceptions of effective and ineffective behaviour are likely to be influenced

by factors such as their feelings toward co-workers, perceptions about the quality of Job Analysis and
their own performances, an their willingness to participate in the critical incidents Job Design
study. To a certain degree – but not entirely – these subjective factors can be
controlled by collecting large numbers of incidents.

c) Job Elements Approach
This method of job analysis was developed by Ernest Primoff at the Federal Office of
Personnel Management and uses as its focus the elements that a worker uses in
performing a specific job. Job elements include knowledge, skills, and abilities
(KSAs), as well as willingness, interest, and personal characteristics (Primoff, 1975).
Like the critical incidents approach, job elements relies on the knowledge and
experiences of supervisors and job incumbents. In the first stop of a job elements
approach to job analysis, these SMEs participate in a brainstorming session in which
they identify as many of the elements of a particular job as possible.
Next, the identified elements are rated on each of four factors:
1) Barely acceptable: What relative portion of even barely acceptable workers is
good in the element?
2) Superior: How important is the element in picking out the superior worker?
3) Trouble: How much trouble is likely if the element is ignored when choosing
among applicants?
4) Practical: Is the element practical? To what extent can we fill our job openings if
we demand it?
Using a statistical procedure developed by Primoff, ratings on the above four factors
are analyzed to determine what elements are most important in selecting superior
workers. Box illustrates a rating blank for job elements. From this information, a
“Crediting Plan,” describing the KSAs necessary for successful job performance and
used for evaluating applicants, can be developed.

Example of Job Element Approach
Ash (1982) used the job elements approach in a study of the job of condominium
manager in Florida. In the initial part of the study, 159 task statements were collected
from books, job descriptions, and surveys of supervisors and job incumbents. Through
a statistical technique known as cluster analysis, the number of tasks was reduced to
nineteen in the following five categories: administrative, fiscal, physical maintenance,
legal, and social.
In the second part of the study, KSAs for each of the 11 tasks were generated by 18
SMEs. Each of the elements were then rated on Primof’s four scales. From this
analysis, a detailed picture of the job duties and tasks of the condominium manager
emerged. Box 2 illustrates the elements under the broader category of personnel and
general management, of the 11 tasks identified by Ash.

Evaluating Job Elements Approach
The job elements approach is an involved procedure that provides a detailed analysis
of a particular job. A major advantage of job elements is that, in addition to
identifying the tasks that constitute a particular job, it is particularly useful for
developing training programs. On the basis of job elements analysis, curricula have
recently been developed for professional training in engineering pharmacology, and
cosmetology.

1 3

Getting Human Like the other methods, however, job elements is time-consuming and costly to
Resources operationalise. Additionally, job analysts may have access to computer programs in
order to complete an analysis. Nevertheless, although job elements has the possibility
of becoming a bit unwieldy, it had had an important effect on developing other
methods of job analysis. Primoff had developed a supplemental procedure (Primoff,
Clark & Caplan, 1982) that combines the job elements method with functional job
analysis and the critical incident technique.
Box 2

Elements of Personnel and General Management for the
Job of Condominium Manager
l Maintain 24-hour call service
l Hire employees
l Train employees
l Evaluate employees
l Establish job descriptions
l Develop fringe benefits package for employees
l Provide ongoing educational program for employees
l Monitor architectural control requirements
l Assign qualified property manager to supervise and administer the day-to-
day on-site activities
l Coordinate volume purchasing
l Develop cost savings procedures

d) Position Analysis Questionnaire (PAQ)
The Position Analysis Questionnaire (PAQ) was developed by McCormick and
associates (1972) on the assumption that there is an underlying taxonomy to all jobs.
That is, in contract to the other methods, the PAQ approach focuses on broad
categories common to all jobs rather than on individual elements of specific jobs.
Given the thousands of tasks for one job that the other methods may identify, PAQ
attempts to put this data into a more manageable form. PAQ reduces all jobs to 194
elements, which are classified in terms of six broader dimensions. These six
dimensions are information input (35 elements), mental processes (14 elements), work
output (49 elements), interpersonal activities (36 elements), work situation and job
context (19 elements), and miscellaneous aspects (41 elements). Descriptions of these
six divisions are presented in Box 3.
McCormick (1979) has suggested that the analysis of jobs through the PAQ approach
is usually carried out by job analysts, methods analysts, personnel officers, or
supervisors. Although job incumbents may use the PAQ form, this is usually restricted
to managers and white-collar workers.

Example of Position Analysis Questionnaire Approach
Robinson, Wahlstrom, and Mecham (1974) used the Position Analysis Questionnaire
to evaluate 131 clerical, craft, and operative jobs to compare various methods of job
evaluation and to determine salary fairness. Evaluation of these jobs was undertaken
at the request of the workers’ union, and since very limited funds were available for
1 4 the project, the PAQ was chosen for the job analysis.

Box 3 Job Analysis and
Job Design
Outline of the Position Analysis Questionnaire
1) Information input. (Where and how does the worker get the information
needed to perform the job?)
Examples: Use of written materials
Near-Visual differentiation
2) Mental processes. (What reasoning, decision-making, planning, and
information-processing activities are involved in performing the job?)
Examples: Level of reasoning in problem solving
Coding/decoding
3) Work output. (What physical activities does the worker perform and what
tools or devices are used?)
Examples: Use of keyboard devices
Assembling/disassembling
4) Relationships with other persons. (What relationships with other people are
required in performing the job?)
Examples: Instructing
Contacts with public, customers
5) Job context (in what physical or social contexts is the work performed?)
Examples: High temperature
Interpersonal conflict situations
6) Other job characteristics. (what activities, conditions, or characteristics other
than those described above are relevant to the job?)

After receiving orientation about the jobs and the use of the PAQ, job analysts,
supervisors, and some job incumbents rated the jobs. Overall, salaries were found to
be fair and all methods of job evaluation had similar results. Interestingly, Robinson
et al. found that the analyses done by the job incumbents were not as thorough as
those done by the supervisors.

Evaluation of Position Analysis Questionnaire
There are several advantages inherent in the Position Analysis Questionnaire. First,
PAQ is structured to allow for easy quantification. The format of the instrument
facilities both data collection and computer analysis and can yield results much faster
than the other methods. Another advantage of quantitative basis of the instrument is
that it has been shown to be extremely reliable. That is, results usually replicate on a
second administration.
Another advantage is that the taxonomic approach of the PAQ makes comparison of
jobs relatively easy. Along the same lines, the taxonomy allows the Position Analysis
Questionnaire to be applied in a wide variety of situations without modifications.
Unlike the other methods discussed, not much time needed for this.
One of the major disadvantages of PAQ, however, is related to its taxonomic
approach. In the previously cited study comparing several methods of job analysis,
Levine and associates (1980) found that the PAQ system was the most disliked,
1 5

Getting Human probably because its language is not specific to particular jobs. Another criticism of
Resources the language used in PAQ is that its reading level is too difficult. Ash and Edgell
(1975) have pointed out that the readability of the instrument is at college level, which
may explain why the use of job incumbents as informants is limited in the PAQ
approach.

e) Physical Abilities Requirements Approach
One limitation of all the methods discussed is that, with the exception of the PAQ, they
are not very useful for determining the physical requirements for job performance.
Although these job analysis methods will identify those tasks that a worker is expected
to accomplish, information about the physical requirements is usually inferred. For
many jobs, qualities such as reaction time, manual dexterity, or trunk strength may be
critical to successful job performance.
Lack of knowledge about physical requirements can lead to problems in many areas,
but particularly in personnel selection and employee turnover, Employers who might
assume that women are unable to accomplish tasks requiring physical strength and
consequently avoid hiring them may be discriminating unfairly. Unless a thorough job
analysis reveals specifically that most women do not have the physical abilities
necessary for successful performance of the job in question (e.g., jackhammer
operator), employers who hire only men may be violating laws governing fairness in
personnel selection.
Uncertainty about physical requirements can also result in turnover or attrition that
can be quite costly to the employer. When an employer or a job applicant is uncertain
about the levels of strengths or flexibility necessary to perform a job, then the
likelihood of the candidate not performing successfully is much greater. Navy
ordinance disposal divers, for example, face such physically demanding tasks that
only 48 per cent of diver candidates even finish a training course (Quigley & Hogan,
1982). Additionally, poor match between applicant abilities and physical requirements
is likely to lead to a higher accident rate.
Fleishman (1975) & Quaintance (1984) had developed a taxonomy of physical and
cognitive abilities that is designed to describe the performance standards of any job.
According to Fleishman, abilities are the foundation on which skills are built. Whereas
operating heavy equipment is a skill, some of coordination, and rate control
(Theologus, Romashko, & Fleishman, 1970). In contrast to the other methods,
considering jobs from an abilities approach results is much greater generalisability of
information across differently jobs.
Levels of physical ability are obviously important in many occupations in our society,
but the analysis of jobs with regard to this area has not been widely explored in
industrial and organizational psychology. As suggested, a lack of knowledge about
physical requirements can lead to problems with selection or employee turnover.

Example of Physical Abilities Requirements Approach
In an important study of the validity of physical ability tests to predict job
performance, Reilly, Zedeck, and Tenopyr (1979) considered the process by which
telephone line technicians, splicers, and installers, were selected. Specifically, these
researchers were interested in predicting the ability of applicants to perform tasks
relating to pole climbing and ladder handling, two essential aspects of successful job
performance.
Job analysis started with group interviews of outdoor craft supervisors in order to
identify those tasks that demanded gross motor proficiency. From these interviews, a
24-item task list was developed. At the same time, the researcher also asked 58 job
1 6

incumbents and supervisors to classify tasks in terms of sensory, perceptual, Job Analysis and
cognitive, psychomotor, and physical abilities scales contained in the Abilities Job Design
Analysis Manual developed by Theologues, Romashko, and Fleishman.

4.6 JOB DESCRIPTION AND JOB SPECIFICATION
Job analysis is the examination of a job, its component parts and the circumstances in
which it is performed. It leads to a job description which sets out the purpose, scope,
duties and responsibilities of a job. From the job analysis and job description, a job
specification may be derived, which is a statement of the skills, knowledge and other
personal attributes required to carry out the job. Some of the uses are:
1) Recruitment and selection, where it is provided a basis for a specification of
what the company is looking for.
2) Training, where by means of skills and task analysis it produces training
specifications which set out training needs and are used to prepare training
programmes.
3) Job evaluation, where by means of whole job or factor comparison, job
descriptions can be compared and decisions made on the relative position of a job
in the hierarchy.
4) Performance appraisal, where the job description resulting from job analysis is
used to decide on the objectives and standards the job holder should reach
against which his or her performance will be measured.
5) Organization Planning, as part of the process of activity.

4.7 TECHNIQUES OF COLLECTING INFORMATION
FOR JOB ANALYSIS
Information about jobs can be collected by means of questionnaire and/or interviews.

a) Questionnaires
Questionnaires, to be completed by job-holders and approved by job-holder’s
superiors, are useful when a large number of jobs are to be covered. They can also
save interviewing time by recording purely factual information and by helping the
analyst to structure his or her questions in advance to cover areas which need to be
explored in greater depth.
Questionnaire should provide the following basic information:
l The job title of the job-holder.
l The title of the job-holder’s superior.
l The job titles and numbers of staff reporting to the job-holder (best recorded by
means of an organization chart).
l A brief description (one or two sentences) of the overall role or purpose
of the job.
l A list of the main tasks or duties that the job-holder has to carry out. As
appropriate, these should specify the resources controlled, the equipment used,
the contacts made and the frequency with which the tasks are carried out.

b) Interview
To obtain the full flavour of a job it is usually necessary to interview job-holders and
to check the findings with their superiors. The aim of the interview is to obtain all the 1 7

Getting Human relevant facts about the job, covering the areas listed above in the section on
Resources questionnaires.
To achieve this aim job analysts should:
1) work to a logical sequence of questions which help the interviewee to order his or
her thoughts about the job;
2) pin people down on what they actually do;
3) ensure that the job-holder is not allowed to get away with vague or inflated
descriptions of his or her work; and
4) obtain a clear statement from the job-holder about his or her authority to make
decisions and the amount of guidance received from his or her superior.

4.8 TECHNIQUES OF WRITING JOB DESCRIPTIONS
Job descriptions are based on the detailed job analysis and should be as brief and as
factual as possible. The headings under which job descriptions are written are set out
below.

Job Title
The existing or proposed job title indicates as clearly as possible the function in which
the job is carried out and the level of the job within that function.

Reporting to
The job title of the manger or superior to whom the job-holder is directly responsible
is given under this heading.

Overall responsibilities
This part describes as concisely as possible the overall purpose of the job. The aim is
to convey in no more than two or three sentences a broad picture of the job which will
clearly distinguish it from other jobs and establish the role of job-holder.

Main tasks
The steps taken to define the main tasks of the job are as follows:
1) Identify and list the tasks that have to be carried out. No attempt is made to
describe in detail how they are carried out, but some indications is given of the
purpose or objectives of each task.
2) Analyze the initial list of tasks and, so far as possible, simplify the list by
grouping related tasks together so that no more than, say, seven or eight main
activity areas remain.
3) Decide on the order in which tasks should be described. The alternatives include :
l Frequency with which they are carried out (continually, hourly, daily,
weekly, monthly, intermittently);
l Chronological order;
l Order of importance; and
l The main process of management that are carried out, for example, setting
objectives, planning, organizing, coordinating, operating, directing and
motivating staff, and controlling.

1 8

4) Describe each main task separately in short numbered paragraphs. No more Job Analysis and
than one or at most two sentences are used for the description, but, if necessary, Job Design
any separate tasks carried out within the task can be tabulated (a, b, c, etc) under
the overall description of the activity. A typical sentence describing a task
should:
l Start with an active verb to eliminate all unnecessary wording. Active
verbs are used which express the actual responsibility to recommend, to do,
ensure that someone else does something, or to collaborate with someone,
e.g. Prepares, completes, recommends, supervises, ensures that, liaises
with;
l State what is done as succinctly as possible; and
l State why it is done: this indicates the purpose of the job gives a lead to
setting targets or performance standards.

4.9 JOB DESIGN
We can say that the that assembly-line workers are fairly highly involved in the work,
even through they have little autonomy.
Thomas M. Lodah
There are two basics ways in which work is organized. The first related to the flow of
authority and is known as organization structure or merely organization. The second
relates to flow of work itself from one operation to another and is known as
procedure. Synonyms are method, system, and work flow. Alert managers usually
recognize the behavioral aspects of organization structure because of the superior-
subordinate relationship which it establishes, but more often than not they ignore or
overlook the behavioral aspects of work flow. The reason that work flow and the lay
out over which it flows are engineering factors, which are to be distinguished from
human factors. In the usual case however, work flow has many behavioral aspects
because it sent people interaction as they perform their work.
One management’s most fundamental idea is systems and method improvement, by
which it seeks to make optimum use of division of labor, and specialization and to
achieve order and balance in the performance of work. However, as indicated in the
quotation introducing this chapter, workers do not like to be “engineered” in methods
improvement. They perceive that improvement is measure in technical terms and that
the human dissatisfaction caused by the “improvement” are generally overlooked. The
goal of methods improvement is greater productivity, but sometimes it brings human
compilations which reduce effectiveness and offset the technical advantages gained.
This part discusses different aspects of work methods. Emphasis is upon the flow of
work among people, rather than the personal work methods of an isolated individual.
Subjects discussed are flow of work and different work systems.

4.10 EFFECTS OF WORK FLOW ON PEOPLE
a) Initiation of Action. One important aspect of work flow is that it determines who
will “initiate” an activity and who will “receive” it. At each point in the flow of work
one person gives material to the next person who will work on it. Along the way, staff
experts give ideas and instruction. This process of sending work to another is an
initiation of action on another person. When an initiation results from work flow, it is
called a procedural initiation to distinguish it from an authority initiation, which
comes from formal authority of a informal organization. The receiver of any initiation
is psychological secondary, but the receiver of a procedural initiation is especially so
1 9

Getting Human because he may receive from a worker who is neither his supervisor nor an informal
Resources leader – from someone who “just shouldn’t be pushing him around.”
When procedural initiation comes from someone of distinctly less skill, someone much
younger, or someone inferior by any measure of status, human problems can become
serious. These problems tend to be compounded if any relationship involves pressure
on the receiver, as in the following example from Whyte’s study of restaurants.
Large restaurants sometimes use young boys as runners to communicate the needs of
the serving pantry to the kitchen. This place the runner in the position of “telling” the
cooks to prepare and send particular types of food. The result is that a young boy
imitates action on high-status cooks. In essence, he is telling them what to do. Whyte
found that this relationship was typically a trouble spot in the restaurants he studied.
Cooks resented the control exercised on them by young boys of inferior status.
Practical solutions included,
1) using a mechanical voice system which eliminated face-to-face contact, and
2) changing the initiator to someone of more status.
Further problems tend to arise when a procedural initiation affects “sensitive” areas
such as how much work a man does (e.g., time study) and his conclusion that
procedural initiations which are from low-status to high-status person, place heavy
pressures on the receiver, or affect sensitive parts of the receiver’s work tend to be
trouble spots. Management’s responsibility is to discover these situations in its work
processes and, if they cannot be avoided to plan them carefully.
Procedural, authority, and informal initiation of action come from person however, not
all work imitations are identifiable as coming directly from some wherein people
respond t cues implicit in the operation situation. For example, a ceramic glaze has
finished its baking cycle and the operator acts to remove it from the furnace, or the
cellophane ribbon creases on cellophane machines and men act as a team to correct it.
In this instance, one cannot determine who initiates an event because it arises from the
work itself. This kind of initiation not identifiable with persons is called a situational
interactions. There is some evidence that persons get satisfaction from working in
harmony with situational initiations and that teams have better moral when their
teamwork primarily involves situational initiations instead of personal ones. The
reasons appears to be what workers are less likely to resent and feel subordinate the
impersonal requirements of the work itself.
b) Systems Design for better Teamwork. Another important aspect of work
procedure is that it should permit people to work together as a team whenever the
work flow requires it. Teamwork can be engineered out of a work situation by means
of layouts and job assignments which separate people so that it is impractical for them
to work together, even though the work flow requirement teamwork. In one instance
two operators, functionally interdependent, was unnecessarily on separate shifts,
which prevented the operator fed parts to two spiral lines which were in competition,
and each line regularly claimed that is favored the other. In another situation the
operator of a continuous bottle forming machine was so far separated from the first
inspection station on this line that he could never be sure whether his machine was
producing satisfactory quality. The problem was met by continuously reporting
inspection result from the inspector to an information panel in front of the operator.
One of the best illustrations of teamwork engineered out of a job is Rice’s study of
textile mill in India. (Box 4).

2 0

Job Design
(Illustration of Teamwork Engineered)
The mill was intensively reengineered according to basic industrial engineering
procedures. Each job had carefully assigned work loads based on engineering study.
In one room there were 224 looms operated and maintained by twelve occupational
groups. Each weaver tended twenty-four on thirty two looms, each battery filler
served forty to fifty looms, and each smash had served and average of seventy-five
looms. The other nice occupations were service and maintained, and each worker
had either 112 or 224 looms.
Although the mill appeared to be superbly engineered, it failed to reach satisfactory
output. Research disclosed that close teamwork of all twelve occupations was
required to maintain production, yet work organization prevented this teamwork.
Each battery filler served all looms of one weaver and part of the looms of a second
weaver, which meant a weaver and battery filler were not a team unit even though
the nature of the process required it. In effect, a weaver tending twenty-four looms
and using a battery filler serving forty looms, worked with three-fifth of a battery
filler, while another weaver shared two-fifths of him. The situation was even more
confused with smash hands who tended seventy-five looms.
Eventually work was reorganized so that a certain group of workers had
responsibility for definite number of machines. Workers then were able to set up
interaction and teamwork which causes production to soar.
Work flow can also be setup in such a way that the job puts unreasonable pressure
on a person. In a series of similar offices the secretary of each was required to
prepare technical correspondence for five to seven managers, answer the telephone,
greet visitors, and serve as group leader of a few clerks. The result was high
turnover and more than a normal amount of nervous disorders among the
secretaries. Another example is that of a hotel food checker who inspected food
brought by waitresses on the telephone. Under conditions of this type it is useless to
try to solve the problem by training the participants to understand each other better,
to communicate better, or to apply good human relations. The first requirement is to
reorganize the work flow then human relations training may not even be needed!
It is well known that plant layout and work flow have much to do with the
opportunity which people have to talk to one another during work. In an insurance
office, for example, the layout of desks was such that persons who needed to
coordinate their work were unnecessarily separated by a broad aisle. Employee met
the problem by loudly calling across the aisle, but this eventually had to be stopped
because of the disturbance. The end result was poor communication. In another
company sewing machines were located so that talking was discouraged but
management soon discovered that another layout which permitted talking led to
higher productivity because it relived the monotony of routine work.
Managers often overlook the fact that layout can also affect off-duty interaction of
employees. Some years ago I visited a new factory which was a model of
engineering efficiency. Although the lunchroom was spotless and efficiently
designed, I ate an uneasily meal. I normally have an affinity for the factory
environment, but his time it was too much—the cafeteria was located in the
basement directly beneath stamping and light forging presses! Vibration was so
terrific it stopped conversation. The floor and ceiling shook; the dished settled; there
was no sound-deadening tile on the ceiling. The space beneath the presses
apparently was not needed for another function; so the cafeteria got it, but
employee communication and relaxation were thereby exclude at mealtime. Lunch
hours in the plant were staggered into four periods, which meant that the presses
operated during the time most employees ate. When I asked my host, “Why?” his
answer “ The cafeteria is for eating only, and anyway, the noise shouldn’t bother 2 1
anyone.”

Getting Human The evidence is clear that work systems and layout have a substantial effect on human
Resources behaviour. They do this by:
1) Determining who initiates procedural action on whom, and some of the
conditions in which the initiations occurs.
2) Influencing the degree to which employees performing interdependent functions
can work together as a team.
3) Affecting the communication patterns of employees.
The general conclusion for management is that relationships among workers in a
system can be just as important as relationships of the work in that system. In the
design of any system it is folly to spend all time planning work relationships but
ignoring worker relationships
c) Control of Red Tape. One aspect of procedure which is universally known as
respected for its effect on people is red tape. It is the unnecessary procedure which
delays and harasses people everywhere. The term originated from real red tape used to
tie official government documents, many of which having long been challenged as
unnecessary by those who prepare them. No doubt some of the work in government
and in business as well is true red tape, but some is in reality “fictions red tape.” It
exists when those who perform the procedure do not know why they are doing it.
They, consequently, think it is red tape, but from a broader viewpoint the work is both
necessary and worthwhile. The remedy for fictitious red tape is improved
communication and development of a broader perspective among those who perform
the work.
Genuine red tape arises primarily because (1) managers are afraid to delegate and
consequently set up all sorts of unnecessary approvals and checks, and (2) procedures,
even through once useful, tend to persist long after their usefulness has passed. The
first reason can be eliminated through good leadership and second reason deserves
further attention at this point.
One cause of the “stickiness” of red tape is normal resistance to change. A procedure
tends to become a habit, and people resist changing it. Since it as, in a sense, set up to
eliminate thinking by giving its followers a routine to use without having to decide
each step, they-seldom think about changing it. They get “stuck in a rut.” Another
cause of useless procedure is that it is often determined by a higher authority who does
not understand work problems, but his personnel hesitate to challenge the procedure
because they did not participate in establishing it. In other cases, people do not know
why they are performing a procedure; consequently they cannot know whether it is
useless or not, and they do not date to expose their “ignorance” by questioning a
procedure with their boss may be able to prove essential beyond a shadow of a doubt.
People do not like to get caught not knowing something about their work.
Another reason for useless procedures is that most of them cross lines of authority,
jumping from one chain of command else worry about. “ they know about this
procedure, too – and it originates with them – so let them change it.” An additional
reason why procedures tend to outlive their usefulness is that the persons who created
them are often supervisors all out of proportion to their real significance. Very often
he focuses extremes attention on one or two of them. They become an obsession with
him and this condition is known as obsessive thinking.
Where conditions permit obsessive thinking and the conditions cannot be changed,
employee effectiveness is increased through the use of activities which occupy the
mind and crowd out obsessive thinking. The more a worker’s mind is kept busy, the
less should be his obsessive thinking. This is one reason management provides music

2 2

in routine and monotonous situations. For this same reason management permits – Job Analysis and
even encourages – talking across the aisle or workbench. Contests and recreational Job Design
programs are other activities which occupy the mind, drive out obsessive thinking, and
provide additional group solidarity.
In order to escape some of the human effects of poorly designed systems more
companies are insisting that their systems experts and industrial engineers have human
relations training. Where the stakes are high, even more stringent requirements may be
set. One company which employed many persons with advanced degrees in its offices
and in small lot of production established the policy of having all job design and
systems work performed by a team of two men. On each team one person was an
industrial engineer concerned with technical requirements, and the other was a human
relations specialist dealing with human aspects of the work.

4.11 DIFFERENT WORK SYSTEMS
The way in which work is organized leads to different work systems.
The following systems will be discussed because of their significant influence on
employee behaviour: produced and functional work systems, labor pools, and
assembly lines.
From the social point of view, we need to design systems which are as
appropriate for people as possible, considering economic and other factors the
situation. Regardless of what kind of system is developed, workers and their
supervisors will try to adjust to it. In nearly all cases they will adjust reasonable well,
because people have a remarkable sense of adaptability. Following is a example of
employee adaptability.
An air-conditioning manufacturer required his three final assembly departments to
complete a specific daily quota of air conditioners. Supervisors soon learned that the
ordinary uncertainties of production caused them to produce over their quota on some
days and under their quota on other days. However, management was quite insistent
that they must meet the quota every day that shipping schedules could be met. In
response to this system established by management, each of the supervisors began his
own, “system.” Each started keeping a store of ten to fifty “almost-finished” air
conditioners under starpaulin in his department. When he saw that he was running
short for the day, he took from this store a nearly finished air conditioner and ran it
through final assembly steps in order to meet his standard of 7—air conditioners for
each eight hours day. Then, when he produced over the standard on another day, he
worked some of his production back into the store.
If a supervisor had a series of bad days, the other supervisors lent to him from their
stores, if necessary, or they lent him a man from their group to help him catch up. In
this way, management’s needs for a standard output were met and supervisors’ needs
for acceptance by management were met.
a) Product and Functional Work Systems. Two somewhat opposing work systems
are product and functional organization of worm. Manufacturing affords an
interesting example. The product system is organized around a complete product to be
made. The functional system is organized on the basis of specialized work activities
rather than products. The two type of work systems in a pharmaceutical firm are as
follow. (Box 5).

2 3

Getting Human Box 5
Resources

Work Systems in a Pharmaceutical Firm
The manufacture of pills and tablets is handled differently in one than in the other.
In the product system all work on tablets is done in one department under one
supervisor. He controls the mixing according to formula, pressing of the tablets,
coating-machine operations, and packaging. He controls a varied set of activities
which follow the product from beginning to completion. In the functional system
tablets are mixed according to formula in the first department; then they are
transported to another department for pressing, to another for coating, and finally
to the packaging department.

The two types of work systems create different employee environments.
In the product system the persons who work together are a conglomerate mix of
skills. They lack a mutual occupational interest because their associates
performing similar work are located throughout the plant. There are
persons mixing formulas in all three departments – tablets, liquid and vaccines.
Though product employees lack a mutual occupational interest, they do see a whole
product made in their work area, so their role in the work process becomes more
meaningful to them. Promotion in the product system usually is gained by learning a
different occupation, such as moving from tablet packager to tablet presser to tablet
coater; therefore the route of promotion is less certain and requires more versatility of
skill. As a result, the workers become broader in experience and outlook.
The foreman in the product system cannot master all the skills in his department, so he
is unable to comment respect of the workers through superior’s ability in their
specialty. He maintains leadership by means of skilled management and human
motivation. He tends to be a broader, more versatile supervisor than the supervisor of
a functional system. His supervision tends to be less punitive and directive, because
natural team work develops as each man sees that his contribution is needed to make
this whole product.
Look now at the functional work system. In the mixing department of the
pharmaceutical firm the foreman probably is the senior man or is the
mixed with greatest skill or knowledge of formulas. Emphasis is on
technical skill rather than human skills. Workers in a functional system no
longer are direct involved in the whole product and tend to feel less responsible
for it. Since their work goes to one department and then another, potential
conflict is increased. Bickering develops over whether work is done on time and
with proper quality, because a breakdown in one department slows the work of all
other departments. Disputes arise concerning who caused a mistake and at
what point a department assumed control of a particular batch of work in process.
In the functional system, top management needs to devote extra attention to
maintaining interdepartmental cooperation and developing broad, human-oriented
supervisors. Both tend to be lacking.
b) Labour Pools. Labour pools are also a special way of organizing work.
Depending upon their objectives and manner of organization, different relationships
develop. An example of this is discussed below (Box 6).

2 4

Job Design
Labour Pool in Oil Refeneries
Oil refineries are required to operate twenty-four hours a day because of the
nature of the production process. One refinery established a central labour pool of
skilled, versatile men to be sent to other departments to replace persons absent.
Before the pool was established, engineers and cost experts carefully proved that
the idea was workable and would reduce costs by reducing overtime and/or
regular standby men in each department. However, after a year of Herculean effort
by management the pool had to be abandoned, for two reasons. First, management
could not keep men in the pool. It lowered their status to be in the pool, and they
objected to working for different foremen on different jobs. They disliked being
without a specific work station which they could count as theirs. Some men chose
to quit the company when transferred to the pool.
Second, the pool increased labour costs instead of decreasing them. Since pool
men, lacked interest and motivation, foremen avoided them and started doubling
shifts (working one of their own men sixteen hours) instead of using pool men.
This left pool men idle, further hurting their morale and increasing pool costs. It
also increased department costs by requiring overtime.
If management had introduced the pool properly, perhaps it could have worked;
but it failed because management was unaware of how the work system was
affecting human relations.

c) Assembly Lines . Assembly lines are a type of product work system, because
work is organized and simplified in terms of the product manufactured. An assembly
line is based on the following concepts: (1) standardization (2) interchangeability of
parts, (3) breakdown of jobs into simple motions, (4) an orderly progression of the
product through a series of operations, and (5) mechanical movement of the product to
and from workers.

4.12 THE CURRENT PICTURE
Organization seeking to maximize the value of competency – based management must
apply it to several human recourses functions, most particularly to learning and
development, resourcing and performance management. Some organization have also
applied it to compensation as well. Organization applying a common model use
competencies as the common denominator in selection, developmental and
performance management processes.
The majority of organization defines competencies in terms of knowledge, skills,
abilities, and personal attributes or characteristics, some including values as part of
their competency models. Common to most models is the use of observable and
measurable behavioral descriptors to describe performance requirement for
competencies and the use of scales to differentiate proficiency levels. The grouping of
competencies by job families or generic job roles is also commonly applied.
Frequently used approaches to competency identification include the use of focus
groups of managers and employees as well as individual interviews with “average”
and “superior “ job performers. Behaviour – based interviews are sometimes used to
from those high – performance behaviours that differentiate successful job
performances from other employees. Some competency models emphasize the
“average” vs. “superior“ performance distinction while others focus on identifying the
competencies that result in “successful” performance on the job.
2 5

Getting Human Among the products that result from competency projects include self-assessment
Resources and 360 degree questionnaires, learning plans and learning resource
information (“learning maps”), behaviour-based interview questions and
other assessment tools.
Competency models vary in terms of the types of competency information they
collect and reflect on “Competency Profiles”, the documents that describe the
particular set of competencies necessary to carry out the work. Some models
focus on technical job – specific knowledge and skills while others emphasize very
generic abilities and personal qualities. More recent models attempt to reflect all the
types of competencies, including knowledge, skills, abilities and personal attributes,
related to job success.

The single-job competency model
Earlier competency models focused on single, critical jobs in an organization, which is
still common. While such models have value – they provide a framework for
describing key job requirements – they are costly to develop and once implemented,
do not allow for comparisons of the requirements of the job profiled with other jobs in
the organization. In addition, they cannot readily be tied in any consistent manner to
existing HR processes that have been re-designed to accommodate a competency
approach, resulting in fragmented HR practices.
For a broad range of jobs, for example, all managerial jobs or front-line jobs. Using
similar techniques as for other competency efforts, a common set of competencies are
developed which can then be used as the basis of HR processes. While cost-effective
and permitting a consistent framework for a large number of employees, this approach
does not clearly describe what is needed in any specific job. This is because seeking
commonalities among different jobs requires that knowledge and skills to be down
played and generic abilities and personal qualities be emphasized. As such, the
competencies have more affinity with organization value than specific job skills or
abilities.
The problem with the one-size-fits-all approach is expressed in the following quote:
“Without the skills component in the model, users say it is often difficult to see the
linkage of the model to Business result and the model doesn’t fully answer the
question, “What do have to know and to do to be considered for that job?”
Additionally, because the model does not differentiate among the requirements of
different jobs, it has limited use in guiding selection, training and other HR processes
for specific jobs and for matching individuals to job assignments. This approach also
shares a problem common to that noted for the single-job approach. That is, the
competencies identified for the particular group of jobs profiled cannot be compared
to other jobs in the organization that were not profiled.

The multiple job approach
What is being seen more frequently as an alternative to the above, is described as the
“Multiple-Job Approach.” This approach uses a common set of “building block”
competencies, including technical competencies, which can be used to build profiles
for any job. The approach allows for a common conceptual framework for an entire
organization while permitting customization for individual jobs.
One of the greatest advantages of using a common language is that by entering
competency information into a database, an organization can being to capture
information about skills gaps, identify training and development needs,
collect qualitative employee data for human resource planning and match
individuals to jobs.
2 6

This approach is more complex to implement because it covers many different types Job Analysis and
of jobs and therefore requires buy-in and effort from many key players. The Job Design
framework and administrative processes required to implements it is also more
complex. However, the multiple-job approach is more cost effective than the single-job
approach if many competency models must developed.

4.13 SUMMARY
To sum up, this unit provided a clear understanding of the process of job analysis and
the methods involved in it. All the methods discussed have some advantages and
disadvantages. Keeping these in view, an efficient Job Analyst uses the required job
analysis technique. Also, the concept of job design and its associated techniques have
been discussed so as to improve your ability to design jobs more effectively.

4.14 SELF ASSESMENT QUESTIONS
1) What is the relevance of job analysis in the modern times?
2) Discuss the methods used job analysis.
3) Discuss the salient features of job analysis
4) How relevant is the understanding of job design for developing organizational
effectiveness.

Ash, R.A. & Levine E.L. (1985) Job applicant training and work experience
evaluation: An empirical comparison of four methods. Tour of Applied Psychology.,
70, 572-576
Bemis, S.E., Belenky, A.H. & Soder, D.A. (1983) Job analysis: An effectiveness
management tool, Washington DC: Bureau of National Affairs.
Denis, D.L. (1984) Are recruitment efforts designed to fail? Personnel Tour, 63, 60-67.
Dunnelte, M.D. (1966) Personal selection and placement. Belmont, C.A. Brooks/Cole.
Fleishman, E.A., & Quaintaner, M.K. (1984) Taxonomics of human performance:
The description of human tasks. New York, Academic Press.

2 7

Getting Human
Resources UNIT 5
Objectives
l understand the concept of Human Resource Planning (HRP);
l discuss the need and objectives of HRP;
l describe the process of HRP; and
l discuss the problems of HRP.

Structure
5.1 What is Human Resource Planning?
5.2 Objectives of HRP
5.3 Levels of HRP
5.4 Process of HRP
5.5 Techniques of HR Demand Forecast
5.6 Factors Affecting HR Demand Forecasting
5.7 Problems in HRP Process
5.8 Guidelines for Making HRP Effective
5.9 Summary

5.1 WHAT IS HUMAN RESOURCE PLANNING?
Human Resource Planning (HRP) may be defined as strategy for acquisition,
utilization, improvement and preservation of the human resources of an enterprise.
The objective is to provide right personnel for the right work and optimum utilization
of the existing human resources. HRP exists as a part of the planning process of
business. This is the activity of the management which is aimed at co-ordinating
requirements for and the availability of different types of employers. The major
activities of HRP include: forecasting (future requirements), inventorying (present
strength), anticipating (comparison of present and future requirements) and planning
(necessary programme to meet future requirements).

Activity A
Identify and tabulate the present position of human resources and future requirement
in your present organization.
........................................................................................................................................................................................
........................................................................................................................................................................................
........................................................................................................................................................................................
........................................................................................................................................................................................
........................................................................................................................................................................................
2 8

Human Resource
5.2 OBJECTIVES OF HRP Planning

The objectives of HRP are mainly to:
a) ensure optimum utilization of human resources currently employed;
b) assess or forecast future requirements;
c) cope up with the changing scenario;
d) attaching with business plans of organization;
e) anticipate redundancies;
f) provide basis for human resource development (HRD); and
g) assist in productivity bargaining.
Benefits of HRP
Proper HRP results into a number of benefits. Some of them are:
a) Create reservior of talent.
b) Preparation for future HR needs.
c) Promote employees in a systematic manner.
d) Provide basis for HRD.
e) Help in career and succession planning.

Need for HRP at Macro Level
Major reasons for the emphasis on HRP at macro level include:
Employment-Unemployment Situation: Though in general the number of educated
unemployed is on the rise, there is acute shortage for a variety of skills. This
emphasises the need for more effective recruitment and retaining people.
Technological Changes: The myriad changes in production technologies, marketing
methods and management techniques have been extensive and rapid. Their effect has
been profound on job contents and job contexts. These changes cause problems
relating to redundancies, retraining and redeployment. All these suggest the need to
plan manpower needs intensively and systematically.
Organizational Changes: In the turbulent environment marked by cyclical
fluctuations and discontinuities, the nature and pace of changes in organizational
environment, activities and structures affect manpower requirements and require
strategic considerations.
Demographic Changes: The changing profile of the work force in terms of age, sex,
litercy, technical inputs and social background have implications for HRP.
Skill Shortages: Unemployment does not mean that the labour market is a buyer’s
market. Organizations have generally become more complex and require a wide range
of specialist skills that are rare and scarce. Problems arise when such employees leave.
Governmental Influences: Government control and changes in legislation with regard
to affirmative action for disadvantaged groups, working conditions and hours of work,
restrictions on women and child employment, casual and contract labout, etc. have
stimulated the organizations to become involved in systematic HRP.
Legislative Controls: The days of executive fiat and ‘hire and fire’ policies are gone.
Now legislation makes it difficult to reduce the size of an organization quickly and
cheaply. It is easy to increase but difficult to shed the fat in terms of the numbers
employed because of recent changes in labour law relating to lay-offs and closures.
Those responsible for managing manpower must look far ahead and thus attempt to
foresee manpower problems.
2 9

Getting Human Impact of Pressure Groups: Pressure groups such as unions, politicians and persons
Resources displaced from land by location of giant enterprises have been raising contradictory
pressures on enterprise management such as internal recruitment and promotions,
preference to employees’ children, displace persons, sons of the soil etc.
Systems Concept: The spread of systems thinking and the advent of the macro-
computer as part of the on-going revolution in information technology which
emphasises planning and newer ways of handling voluminous personnel records.
Lead Time: The long lead time is necessary in the selection process and for training
and deployment of the employee to handle new knowledge and skills successfully.

5.3 LEVELS OF HRP
HRP is carried out at the following levels:
a) National Level: The Central Government plans for human resources at the
national level. It forecasts the demand for and supply of human resources as a
whole. For example, the Government of India specifies the objectives of HRP in
successive five-year plans.
b) Sectoral Levels: Central and State Governments, formulate HRPs for different
sectors. For example, industrial sector, agricultural sector etc.
c) Industry Level: HRP for specific industries are prepared by the particular
industries.
d) Unit Level: HRP for a particular department/sector of an industry is prepared at
this level. It again includes the following levels.
i) Plant level;
ii) Department level; and
iii) Divisional level.

5.4 PROCESS OF HRP
The process of HRP is entirely based on the corporate plans and objectives. HRP is a
continuous process of review, control and assessment. Figure 1 clearly indicates the
HRP process. 1
Corporate Analysis
(a) Objectives and Strategies
s

(b) Company Organization Plans
(c) Market forecasts and Budgets
Manpower Objectives and Policies

(d) Financial Plans
(e) Production Targets
Modify Organizational Plans
2 4 3
Demand Forecast Manpower Gaps Supply Forecast
(a) Numbers (a) Surplus of numbers (a) Manpower
(b) Job Categories and skills inventory
(c) Skill requirements (b) Shortages (b) Losses and
additions
5 (c) Externat Supply
Manpower Plans
(a) Recruitment and Selection
(b) Training and Development
(c) Redeployment/Retrenchmant
s

(d) Redundancy
(e) Retention/internal mobility
(f) Productivity

Monitoring and Control

Figure 1: Human Resource Planning Process
3 0 Source: Gupta, C.B. (1997). Human Resource Management, Sultan Chand & Co., New Delhi.

The major stages of HRP are as follows: Human Resource
Planning
a) Analysing Operational Plans
It consists of the following substages:
i) Objectives and strategic plans of the company are analyzed.
ii) Plans concerning technological, finance, production are analyzed and HRP is
prepared keeping these in mind.
iii) Future plans, goals, and objectives of the company are also taken into account.

b) Human Resource Demand Forecasting
HR demand forecasting mainly involves three sub functions:
i) Demand Forecast: Process of estimating future quantity and quality of human
resources required.
ii) Manpower Gaps: Depending upon the requirement existing surplus human
resources having desired skills are matched, if not found then shortage is shown.
iii) Supply Forecast: Basing on the existing HR inventory and the demand forecast,
the supply forecast of human resources is carried out in an organization.

5.5 TECHNIQUES OF HR DEMAND FORECAST
Techniques of HR demand forecast are discussed below.
a) Managerial Judgement: In this, experienced managers estimate the human
resource requirements for their respective departments on the basis of their
knowledge of expected future work load and employee efficiency.
b) Work-study Method: In this method time and motion study are used to analyze
and measure the work being done.
c) Ratio-Trend Analysis: Under this method ratios (e.g. total output/no. of
workers, direct workers/indirect workers) are calculated on the basis of past
data. Future ratios are basing on the past trend.
d) Mathematical Models: It expresses the relationship between independent
variable (e.g. investment, production, sales, etc.) and dependent variables (e.g.
no. of employees required).

Activity B
Describe how human resource demand forecast is carried out in your organization or
an organization you are familiar with.
........................................................................................................................................................................................
........................................................................................................................................................................................
........................................................................................................................................................................................
........................................................................................................................................................................................

5.6 FACTORS AFFECTING HR DEMAND FORECASTING
Human Resource Demand Forecasting depends on several factors, some of which are
given below.
a) Employment trends;
b) Replacement needs; 3 1

Getting Human c) Productivity;
Resources
d) Absenteeism; and
e) Expansion and growth.

5.7 PROBLEMS IN HRP PROCESS
The main problems in the process of HRP are as follows:
a) Inaccuracy: HRP is entirely dependent on the HR forecasting and supply, which
cannot be a cent per cent accurate process.
b) Employee resistance: Employees and their unions feel that by HRP, their
workload increases so they resist the process.
c) Uncertainties: Labour absenteeism, labour turnover, seasonal employment,
technological changes and market fluctuations are the uncertainties which HRP
process might have to face.
d) Inefficient information system: In Indian industries, HRIS is not much strong.
In the absence of reliable data it is not possible to develop effective HRP.
e) Time and expense: HRP is time consuming and expensive exercice, so industries
avoid.

5.8 GUIDELINES FOR MAKING HRP EFFECTIVE
Few guidelines to improve effectiveness of HRP process are discussed below.
a) Tailormade: HRP should be balanced with corporate objectives.
b) Appropriate time: The period of HRP process should be appropriate to the needs
and circumstances of an organization.
c) Adequate organization: HRP process should be adequately/properly organized.
d) Top management support: Before starting the HRP process the support and
commitment of top management should be ensured.
e) Participation: HRP will be successful if all in an organization are participating.
f) Information system: An adequate database should be developed for facilitating
HRP.
g) Balanced focus: The quantity and quality should be stressed in a balanced
manner.

5.9 SUMMARY
To sum up, HRP is the process of determining the number and kind of human
resources required in an organization for a specific time period in future. HRP is
important for an organization because of the changing scenario. HRP is formulated at
various levels. The main steps involved in it are analysis of organizational plans,
demand forecasting, supply forecasting and identifying manpower gaps.

1) Explain the objectives of HRP.
2) Describethe process of HRP with illustrations.
3) Discuss the problems in HRP and state measures to overcome them.
3 2 4) Briefly review the forecasting techniques.

Human Resource
5.11 FURTHER READINGS Planning

Gupta, C.B. (1997). Human Resource Management, S. Chand & Sons, New Delhi.
Pattanayak, B. (2001). Human Resource Management, PHI, New Delhi.
Aswathappa, K. (1999). Human Resource and Personnel Management,
Tata McGraw Hill, New Delhi.

3 3

Getting Human
Resources UNIT 6 ATTRACTING THE TALENT:
RECRUITMENT, SELECTION,
OUTSOURCING
Objectives
l explain the need for spelling out job specification as the starting point for the
process of selection;
l name various sources which can be used for attracting the desired types of
manpower;
l state, explain and evaluate various methods of recruitment;
l explain the need for and the process of initial screening;
l describe the process of application scrutiny;
l explain the need for, types of, and the uses of various psychological tests in the
evaluation of candidates;
l explain the purpose and types of interviews, their limitations, and the need for
care in using them;
l explain the purpose of induction and how it is carried out; and
l discuss the function of outsourcing.

Structure
6.1 Introduction
6.2 Some Definitions
6.3 The Process of Recruitment
6.4 Methods of Recruitment
6.5 Selection
6.6 Selection Tests
6.7 Interview
6.8 Physical Examination
6.9 Reference Checks
6.10 Final Decision
6.11 Placement
6.12 Induction
6.13 Outsourcing
6.14 Road Map for Successful Outsourcing
6.15 Summary

6.1 INTRODUCTION
The most valuable asset of any large-scale organization is the high-calibre employees.
Finding right people and putting them at right job is the most important challenge for
3 4 any organization. At the stage of Human Resource Planning, as we have already

discussed in the previous unit, the human resource requirement is forecasted. Keeping Attracting the Talent:
in mind the forecast the function of attracting the best available talent is carried out by Recruitment, Selection,
Outsourcing
an organization. It involves functions like; recruitment, selection, induction. All these
are discussed in this unit.

6.2 SOME DEFINITIONS
Recruitment
Recruitment is the process of identifying the prospective employees, stimulating and
encouraging them to apply for a particular job or jobs in an organization. It is a
positive action as it involves inviting people to apply. The purpose is to have an
inventory of eligible persons from amongst whom proper selection of the most suitable
person can be made.

Selection
Selection is the process of examining the applicants with regard to their suitability for
the given job or jobs, and choosing the best from the suitable candidates and rejecting
the others. Thus, you will notice that this process is negative in nature in the sense that
rejection of candidates is involved.

Placement
Placement is the determination of the job for which a selected candidate is best susited
and assigning that job to him. The ideal situation is ‘the right man for the right job’. A
proper placement of a worker reduces employee turnover, absenteeism, accident rates,
etc., and improves morale, motivation, work, etc.

Induction
Induction is introducing an employee to the job and to the organization. The primary
purpose of induction is to ‘sell’ the company to the new employee so that he may feel
proud of his association with the company. This is called ‘orientation’ or
‘indoctrination’.

Their Inter-relationship
The above are the four steps taken in the order given before a person starts his
training for the job to which he is assigned. First he is recruited, that is, his attention is
drawn to the existence of a possible opening for him and he is invited to apply for it.
In the next stage of selection all the applicants are screened to find their suitability for
the job and the best one is selected. The third step of placement follows selection and a
particular job is assigned to the selected person. After that he is introduced to his job
and to his organization so that he may understand the environment in which he has to
work.
Having defined these four processes, we shall describe them in some detail in the
following paragraphs.

6.3 THE PROCESS OF RECRUITMENT
Preparation for Recruitment
Before you think of inviting people to apply for a job you have to decide what types of
persons are to be invited and what their characteristics should be. This calls for fixing
the ‘job specifications’ which may also be called ‘man specifications’.
3 5

Getting Human Job specifications are based on job description which is dependent upon the nature and
Resources requirements of a job. Thus, job specification will be different for each job.
We shall explain below the various elements of job specification.
Physical Specifications: For certain jobs some special physical features may be
required. For example, for assembly of a TV set or some other electronic equipment
good vision is required, for a typing job you need finger dexterity, for a heavy job you
need a strong, heavy and thick-set body. The particular physical abilities and skills
necessary for a given job have to be specified. These may refer to height, weight,
vision, finger dexterity, voice, poise, hand and foot coordination, motor coordination,
colour discrimination, age-range, etc.
Mental Specifications: These include intelligence, memory, judgement, ability –
plan, ability to estimate, to read, to write, to think and concentrate, scientific faculties,
arithmetical abilities, etc. Different jobs require different degrees of such abilities and
the more important ones should be specified.
Emotional and Social Specifications: These include characteristics which will affect
his working with others, like personal appearance, manners, emotional stability,
aggressiveness, or submissiveness, extroversion or introversion, leadership,
cooperativeness, initiative and drive, skill in dealing with others, socia1 adaptability,
etc.
Behavioral Specifications: Certain management personnel at higher levels of
management are expected to behave in a particular manner. These are not formally
listed but have to be kept in mind during the process of recruitment, selection and
placement.

Activity A
Please describe below your job as carefully and precisely as you can.
.....................................................................................................................................
.....................................................................................................................................
.....................................................................................................................................
.....................................................................................................................................
.....................................................................................................................................
Please give below the ten most important elements of your job specification. Also
evaluate yourself in respect of each element and write against it whether you meet it
(a) fully, (b) substantially, (c) to some extent, or (d) not at all.

Element Extent of meeting (a), (b), (c), (d)
1) ...................................................... ..........................................................
2) ...................................................... ..........................................................
3) ...................................................... ..........................................................
4) ...................................................... ..........................................................
5) ...................................................... ..........................................................
6) ...................................................... ..........................................................
7) ...................................................... ..........................................................
8) ...................................................... ..........................................................
9) ...................................................... ..........................................................

3 6
10) ...................................................... ..........................................................

Sources of Manpower Attracting the Talent:
Recruitment, Selection,
There are two categories of sources of supply of manpower— Internal and External. Outsourcing

Internal Sources: These include personnel already on the pay-roll of the organization
as also those who were once on the pay-roll of the company but who plan to return, or
whom the company, would like to rehire. These include those who quit voluntarily or
those on production lay-offs.
External Sources: These sources lie outside the organization, like the new entrants to
the labour force without experience. These include college students, the unemployed
with a wider range of skills and abilities, the retired experienced persons, and others
not in the labour force, like married women.
A policy of preferring people from within is advantageous as it improves the morale of
the employees and promotes loyalty among them towards the organization. This also
helps employers as they are in a better position to evaluate those already with them
and as these people require no induction.
The policy of preferring internal candidates, however, suffers from some
disadvantages. It may lead to inbreeding, discouraging new blood from entering an
organization. If promotion is based on seniority, the real capable hands may be left
out.
Likewise, there are good and bad points about external sources. These sources provide
a wide market and the best selection considering skill, training and education. It also
helps to bring new ideas into the organization. Moreover, this source never ‘dries up’.
In respect of people selected under this system, however, one has to take chances with
the selected persons regarding their loyalty and desire to continue. The organization
has to make larger investments in their training and induction.
You will realize now that dependence on just one of the sources is not in the interest of
an organization. It must depend on both in a ratio to be fixed considering various
factors.
Some of these factors are described below.
1) Effect of the policy on the attitude and actions of all employees: Employees,
no doubt, feel more secure and identify their own long-term interest with that of
the organization when they can anticipate first charge at job opportunities. The
general application of the ‘promotion from within’ policy may encourage
mediocre performance. The point to be considered here by the organization is,
how important is the loyalty of the employees to it, balancing the risk of
mediocre performance.
2) The level of specialization required of employees: The principal source in
many organizations may be the ranks of the present employees who have
received specialized training.
3) The degree of emphasis on participation by employees at all levels: New
employees from outside, with no experience in the firm, may not know enough
about its service or product or processes to participate effectively, for some time
at least.
4) The need for and availability of originality and initiative within the
organization: If the organization feels that it is training its people for these
qualities it may prefer its own people; if not, new people with different ideas may
be taken from outside.
5) Acceptance of seniority principle: The policy or promotion from within will
succeed only if management and employees accept the seniority principle with or
without suitable modifications for promotion. If it is not accepted, selection may
3 7
better be done on an open basis.

Getting Human
Resources 6.4 METHODS OF RECRUITMENT
All methods of recruitment can be put into three categories: (a) Direct Methods,
(b) Indirect Methods, and (c) Third-Party Methods.
a) Direct Methods include sending recruiters to educational and professional
institutions, employee contacts with public, manned exhibits and waiting lists.
Schools and Colleges: For clerical, labour and apprenticeship help, high schools can
be extensively used. For technical, managerial and professional jobs, colleges,
university departments and specialized institutes, like the IITs and IIMs, are used.
These institutions usually have a placement officer a teacher-in-charge of placement,
who normally provides help in attracting employers arranging interviews, furnishing
space and other facilities and providing student resumes. The companies maintain a
list of such institutions, keep in touch with them, send their brochures indicating job
openings, future prospects, etc. On the basis of these students who want to be
considered for the given job (s) are referred to the company recruiter.
Employees’ Contact with the Public: The employees of the organization are told
about the existence of particular vacancies and they bring this to the notice of their
relatives, friends and acquaintances.
Manned Exhibits: The organizations send recruiters to conventions and seminars,
setting up exhibition at fairs, and using mobile offices to go to the desired centres.
Waiting Lists: Many firms lean heavily on their own application files. These records
list individuals who have indicated their interest in jobs, either after visiting the
organization’s employment office or making enquiries by mail or phone. Such records
prove a very useful source if they are kept up-to-date.
b) Indirect Methods cover advertising in newspapers, on the radio, in. trade and
professional journals, technical journals and brochures.
When qualified and experienced persons are not available through other sources,
advertising in newspapers and professional and technical journals is made. Whereas
all types of advertisements can be made in newspapers and magazines, only particular
types of posts should be advertised in the professional and technical journals; for
example, only engineering jobs should be inserted in journals of engineering. .
A well thought-out and planned advertisement for an appointment reduces the
possibility of unqualified people applying. If the advertisement is clear and to the
point, candidates can assess their abilities and suitability for the position and only
those who possess the requisite qualifications will apply.
c) Third-Party Methods: Various agencies are used for recruitment under these
methods. These include commercial and private employment agencies, state agencies,
placement offices of schools, colleges and professional associations, recruiting firms,
management consulting firms, indoctrination seminars for college professors, friends
and relatives.
Private Employment Agencies specialize in specific occupation like general office
help, salesmen, technical workers, accountants, computer staff, engineers and
executives, etc. These agencies bring together the employers and suitable persons
available for a job. Because of their specialization, they can interpret the needs of their
clients and seek out particular types of persons.
State or Public Employment Agencies, also known as Employment or Labour
Exchanges, are the main agencies for public employment. They also provide a wide
range of services, like counselling, assistance in getting jobs, information about the
labour market, labour and wage rates, etc.
3 8

Executive Search Agencies maintain complete information records about employed Attracting the Talent:
executives and recommend persons of high calibre for managerial, marketing and Recruitment, Selection,
Outsourcing
production engineers’ posts. These agencies are looked upon as ‘head hunters’,
‘raiders’, and ‘pirates’.
Indoctrination Seminars for College Professors: These are arranged to discuss the
problems of companies to which professors are invited. Visits and banquets are
arranged so that professors may be favourably impressed and later speak well of the
company and help in getting required personnel.
Friends and Relatives of Present Employees constitute a good source from which
employees may be drawn. This, however, is likely to encourage nepotism, i.e. persons
of one’s own community or caste may only be employed. This may create problems
for the organization.
Trade Unions are often called on by the employers to supply whatever additional
employees may be needed. Unions may be asked for recommendations largely as a
matter of courtesy and an evidence of good will and cooperation.
Professional Societies may provide leads and clues in providing promising candidates
for engineering, technical and management positions. Some of these maintain mail
order placement services.
Temporary Help Agencies employ their own labour force, both full-time and part-
time and make them available to their client organizations for temporary needs.
Casual Labour Source is one which presents itself daily at the factory gate or
employment office. Most industrial units rely to some extent on this source. This
source, you will realise, is the most uncertain of all sources.
Deputation: Persons possessing certain abilities useful to another organization are
sometimes deputed to it for a specified duration. Ready expertise is available but, as
you can guess, such employees do not easily become part of the organization.

Activity B
a) Recall your first appointment to the present organization and write below which
of the above mentioned sources of recruitment was used by the organization.
...........................................................................................................................
...........................................................................................................................
...........................................................................................................................
...........................................................................................................................
...........................................................................................................................

b) Think of the various sources tapped by your organization in getting employees for
your Section/Department and write below in order of importance the first five. .
1) ...........................................................................................................................
2) ...........................................................................................................................
3) ...........................................................................................................................
4) ...........................................................................................................................
5) ...........................................................................................................................

3 9

Getting Human
Resources 6.5 SELECTION
Selection, as you have seen earlier, is the process of securing relevant information
about an applicant to evaluate his qualifications, experience and other qualities with a
view to matching these with the requirements of a job. It is essentially a process of
picking out the man or men best suited for the organization’s requirements.

The Selection Process
You would recall that selection process involves rejection of unsuitable or less suitable
applicants. This may be done at any of the successive hurdles which an applicant must
cross. These hurdles act as screens designed to eliminate an unqualified applicant at
any point in the process. This technique is known as the ‘successive hurdles
technique’. Figure 1 gives these hurdles.
Yoder calls these hurdles ‘go, no-go’ gauges. Those who qualify a hurdle go to the
next one; those who do not qualify.are dropped out. Not all selection processes,
however, include these hurdles. The complexity of the process usually increases with
the level and responsibility of the position to be filled. Moreover, these hurdles need
not necessarily be placed in the same order. Their arrangement may differ from
organisation to organization.

Employment
Interview with
Recommendation

Supervisor
Examination
Physical
References
Work History

Application Þ
Testing
Interview
Second
Application
Prelimmary

Form
Interview

Rejections

Figure 1: Successive Hurdles in the Selection Process

Initial Screening or Preliminary Interview
This is a sorting process in which prospective applicants are given the necessary
information about the nature of the job and also, necessary information is elicited from
the candidates about their education, experience, skill, salary expected, etc. If the
candidate is found to be suitable, he is selected for further process and, if not, he is
eliminated. This is a crude screening and can be done across the counter in the
organization’s employment offices. This is done by a junior executive in the personnel
department. Due care should be taken so that suitable candidates are not turned down
in a hurry. Since this provides personal contact for an individual with the company,
4 0 the interviewer should be courteous, kind, receptive and informal.

When a candidate is found suitable, an application form is given to him to fill in Attracting the Talent:
and submit. Recruitment, Selection,
Outsourcing

Application Scrutiny
You might have seen that sometimes applications are asked on a plain sheet. This is
done where no application forms are designed. The applicant is asked to give details
about age, marital status, educational qualifications, work experience and references.
Different types of application forms may be used by the same organization for
different types of employees, e.g., one for managers, the other for supervisors and a
third for other employees. Some forms are simple, general and easily answerable,
while others may require elaborate, complex and detailed information. Reference to
nationality, race, caste, religion and place of birth has been regarded as evidence of
discriminatory attitudes and should be avoided. An application form should be
designed to serve as a highly effective preliminary screening device, particularly, when
applications arc received in direct response to an advertisement and without any
preliminary interview.
The application can be used in two ways: (i) to find out on the basis of information
contained therein as to the chances of success of the candidate in the job for which he
is applying, and (ii) to provide a starting point for the interview.
It is often possible to reject candidates on the basis of scrutiny of the applications as
they are found to be lacking in educational standards, experience or some other
relevant eligibility and traits.

6.6 SELECTION TESTS
A test is a sample of an aspect of an individual’s behavior, performance or attitude. It
can also be a systematic procedure for comparing the behavior of two or more
persons.
Purpose of Tests: The basic assumption underlying the use of tests in personnel
selection is that individuals are different in their job-related abilities and skills and that
these skills can be adequately and accurately measured.
Tests seek to eliminate the possibility of prejudice on the part of the interviewer or
supervisor. Potential ability only will govern selection decisions.
The other major advantage is that the tests may uncover qualifications and talents that
would not be detected by interviews or by listing of education and job expenence.
Types of Tests: The various tests used in selection can be put in to four categories:
(a) Achievement or Intelligence Tests, (b) Aptitude or Potential Ability Tests,
(c) Personality Tests, and (d) Interest Tests.
These tests and what they measure are described below.

a) Achievement or Intelligence Tests
These are also called ‘proficiency tests’. These measure the skill or knowledge which
is acquired as a result of a training programme and on the job experience. These
measure what the applicant can do. These are of two types:
Test for Measuring job Knowledge: These are known as ‘Trade Tests’. These are
administered to determine knowledge of typing, shorthand and in operating
calculators, adding machines, dictating and transcribing machines or simple
mechanical equipment. These are primarily oral tests consisting of a series of
questions which are believed to be satisfactorily answered only by those who know
and thoroughly understand the trade or occupation. Oral tests may be supplemented
by written, picture or performance types. 4 1

Getting Human Work Sample Tests: These measure the proficiency with which equipment can be
Resources handled by the candidate. This is done by giving him a piece of work to judge how
efficiently he does it. For example, a typing test would provide the material to be
typed and note the time taken and mistakes committed.

b) Aptitude or Potential Ability Tests
These tests measure the latent ability of a candidate to learn a new job or skill.
Through these tests you can detect peculiarity or defects in a person’s sensory or
intellectual capacity. These focus attention on particular types of talent such as
learning, reasoning and mechanical or musical aptitude..’Instruments’ used are
variously described as tests of ‘intelligence’, ‘mental ability’, ‘mental alertness’, or
simply as ‘personnel tests’. These are of three types:
i) Mental Tests: These measure the overall intellectual ability or the intelligence
quotient (I.Q.) of a person and enable us to know whether he has the mental
capacity to deal with new problems. These determine an employee’s fluency in
language, memory, interction, reasoning, speed of perception, and spatial
visualisation.
ii) Mechanical Aptitude Tests: These measure the capacity of a person to learn a
particular type of mechanical work. These are useful when apprentices,
machinists, mechanics, maintenance workers, and mechanical technicians are to
be selected.
iii) Psychomotor or Skill Tests: These measure a person’s ability to do a specific
job. These are administered to determine mental dexterity or motor ability and
similar attributes involving muscular movement, control and coordination. These
are primarily used in the selection of workers who have to perform semi-skilled
and repetitive jobs, like assembly work, packing, testing, inspection and so on.

c) Personality Tests
These discover clues to an individual’s value system, his emotional reactions, maturity
and his characteristic mood. The tests help in assessing a person’s motivation, his
ability to adjust himself to the stresses of everyday life and his capacity for inter-
personal relations and for projecting an impressive image of himself. They are
expressed in terms of the relative significance of such traits of a person as self-
confidence, ambition, tact, emotional control, optimism, decisiveness, sociability,
conformity, objectivity, patience, fear, distrust, initiative, judgement, dominance,
impulsiveness, sympathy, integrity, and stability. These tests are given to predict
potential performance and success for supervisory or managerial jobs.
The personality tests are basically of three types:
i) Objective Tests: These measure neurotic tendencies, self-sufficiency, dominance,
submission and self-confidence.
ii) Projective Tests: In these tests, a candidate is asked to project his own
interpretation onto certain standard stimuli. The way in which he responds to
these stimuli depends on his own values, motives and personality.
iii) Situation Tests: These measure an applicant’s reaction when he is placed in a
peculiar situation, his ability to undergo stress and his demonstration of ingenuity
under pressure. These tests usually relate to a leaderless group situation, in
which some problems are posed to a group and its members are asked to reach
some conclusions without the help of a leader.

d) Interest Tests
These tests are designed to discover a person’s areas of interest and to identify the
kind of work that will satisfy him. The interest tests are used for vocational guidance,
4 2
and are assessed in the form of answers to a well-prepared questionnaire.

Limitations of Selection Tests: From the basic description of tests described above, Attracting the Talent:
one should not conclude that a hundred per cent prediction of an individual’s on-the- Recruitment, Selection,
Outsourcing
job success can be made through these tests. These tests, at best, reveal that
candidates who have scored above the predetermined cut-off points are likely to be
more successful than those who have scored below the cut-off point.
Tests are useful when the number of applicants is large. Moreover, tests will serve no
useful purpose if they are not properly constructed or selected or administered.
Precautions in using Selection Tests: Test results can help in selecting the best
candidates if the following precautions are taken:
i) Norms should be developed as a source of reference on all tests used in selection
and on a representative sample of people on a given job in the same organization.
This is necessary even though ‘standard’ tests are available now under each of
the above categories. Norms developed dsewhere should not be blindly used
because companies differ in their requirements, culture, organization structure
and philosophy.
ii) Some ‘Warm up’ should be provided to candidates either by giving samples of
test, and/or answering queries before the test begins.
iii) Tests should first be validated for a given organization and then administered for
selection of personnel to the organization.
iv) Each test used should be assigned a weightage in the selection.
v) Test scoring, administration and interpretation should be done by persons I
having technical competence and training in testing.

Activity C
a) Was any psychological test administered to you for selection or promotion?
Yes No
b) If yes, can you recall at what stage of your career was it given and what were
you required to do?
.........................................................................................................................
.........................................................................................................................
.........................................................................................................................
.........................................................................................................................
c) Can you fit it into one of the above mentioned categories?
Stage Required to do Category of Test
First Selection as...............................................................................................
..........................................................................................................................
..........................................................................................................................
Later promotion as ............................................................................................
..........................................................................................................................
..........................................................................................................................

6.7 INTERVIEW
We shall now discuss the post application form interview and not the preliminary
interview. Personal interview is the most universally used tool in any selection
process.
4 3

Getting Human Meaning and Purpose: An interview is a conversation with a purpose between one
Resources person on one side and another person or persons on the other. An employment
interview should serve three purposes, viz., (i) obtaining information, (ii) giving
information, and (iii) motivation. It should provide an appraisal of personality by
obtaining relevant information about the prospective employee’s background, training
work history, education and interests. The candidate should be given information
about the company, the specific job and the personnel policies. It should also help in
establishing a friendly relationship between the employer and the applicant and
motivate the satisfactory applicant to want to work for the company or organization.
In practice, however, it may turn out to be a one-sided affair. It helps only in obtaining
information about the candidate. The other two purposes are generally not served.
Types of Interview
Informal Interview: This is may take place anywhere. The employer or a manager in
the personnal department, may ask a few questions, like name, place of birth, previous
experience, etc. It is not planned and is used widely when the labour market is tight
and you need workers very badly. A friend or a relative of the employer may take a
candidate to the house of the employer or manager where this type of interview may
be conducted.
Formal Interview: This held in a more formal atmosphere in the employment office
by the employment officer with the help of well-structured questions. The time and
place of the interview are stipulated by the employment office.
Planned Interview: This is a formal interview carefully planned. The interviewer has
a plan of action worked out in relation to time to be devoted to each candidate, type of
information to be sought, information to be given, the modality of interview and so on.
He may use the plan with some amount of flexibility.
Patterned Interview: This is also a planned interview but planned to a higher degree
of accuracy, precision and exactitude. A list of questions and areas are carefully
prepared. The interviewer goes down the list of questions, asking them one after
another.
Non-directive Interview: This is designed to let the interviewee speak his mind freely.
The interviewer is a careful and patient listener, prodding whenever the candidate is
silent. The idea is to give the candidate complete freedom to ‘sell’ himself without
encumberances of the interviewer’s questions.
Depth Interview: This is designed to intensively examine the candidate’s background
and thinking and to go into considerable detail on a particular subject to special
interest to the candidate. The theory behind it is that if the candidate is found good in
his area of special interest, the chances are high that if given a job he would take
serious interest in it.
Stress Interview: This is designed to test the candidate and his conduct and behavior
by putting him under conditions of stress and strain. This is very useful to test the
behavior of individuals under disagreeable and trying situations.
Group Interview: This is designed to see how the candidates react to and against each
other. All the candidates may be brought together in the office and they may be
interviewed. The candidates may, alternatively, be given a topic for discussion and be
observed as to who will lead the discussion, how they will participate in the
discussion, how each will make his presentation and how they will react to each
other’s views and presentation.
Panel Interview: This is done by members of the interview board or a selection
committee. This is done usually for supervisory and managerial positions. It pools the
4 4

collective judgement and wisdom of members of the panel. The candidate may be Attracting the Talent:
asked to meet the panel individually for a fairly lengthy interview. Recruitment, Selection,
Outsourcing
Interview Rating: Important aspects of personality can be categorized under the
following seven main headings:
l Physical Make-up: Health, physique, age, appearance, bearing, speech.
l Attainments: Education, occupational training and experience.
l Intelligence: Basic and ‘effective’.
l Special Aptitudes: Written and oral fluency of expression, numeracy,
organizational ability, administrative skill.
l Interests: Intellectual, practical, physically active, social, artistic
l Disposition: Self-reliance, nature, motivation, acceptability.
l Circumstances: Domestic, social background and experience, future prospects.
This is called ‘The Seven Point Plan’. The importance of each of these points will
vary from organization to organization and from job to job. Hence, these should be
assigned weightage according to their degree of importance for the job.
On the basis of information gathered through an interview, each candidate should be
rated in respect of each point given above as: (i) outstanding, (ii) good, (iii) above
average, (iv) below average or (v) unsatisfactory. Marks should be allotted to each of
these, and the score for each point is arrived at by multiplying it by weights and the
total of all these will determine the final position of a candidate at the interview.
Limitations of Interviews: Interviews have their own limitations in matters of
selection. Some of these are mentioned below:
l Subjective judgement of the interviewer may be based on his prejudices, likes,
dislikes, biases, etc.
l One prominent characteristic of a candidate may be allowed to dominate
appraisal of the entire personality.
l The interviewer’s experience may have created a close association between some
particular trait and a distinctive type of personality.
l Some managers believe that they are good at character analysis based on some
pseudo-scientific methods and are guided by their own abilities at it.
Qualities of ‘Good’ lnterviewers as: A good interviewer should have the following
qualities:
l Knowledge of the job or other things with which interviews are concerned.
l Emotional maturity and a stable personality.
l Sensitivity to the interviewee’s feelings and a sympathetic attitude.
l Extrovert behavior and considerable physical and mental stamina.
Guidelines for Improving Interviews: Not all interviews are effective. Their
effectiveness can be improved if the following points are kept in mind by an
interviewer:
l An interview should have a definite time schedule with ample time for interview.
It should not be hurried.
l The impersonal approach should be avoided.
l Interview should have the necessary element of privacy.
l The interviewer should listen carefully to what the applicant says and the
information collected should be carefully recorded either while the interview is
going on or immediately thereafter. 4 5

Getting Human l Attention should be paid not just to the words spoken, but also to the facial
Resources expressions and mannerisms of the interviewee.
l The interview should end when sufficient information has been gathered.
l The interviewee should be told where he stands—whether he will be contacted
later, whether he is to visit another person, or it appears that the organization will
not be able to use his abilities.
Pseudo-Scientific Methods of Selection: In the past, and to some extent even now,
stereotyped impressions of personality and characteristics were used as a basis of
selection. These impressions were gathered through pseudo-scientific methods, like
phrenology, physiognomy and graphology.
We shall briefly describe below these methods for your background knowledge only:
Phrenology: Here it is believed that the strength of each faculty is indicated by
prominent bumps on certain parts of the skull.
Physiognomy: Here it is believed that there is a definite correlation between facial
features and psychological functions and behaviour, for example, thin lips indicate
determination, broad jaws signify tenacity and so on.
Graphology: Here it is believed that there is a close relationship between handwriting
and personality.

Activity D
Please find out from your Personel Department which of the above mentioned types of
interviews they use for the purpose of selection. What do they aim to judge through
each of these interviews and for selection of what level of employees are these used?
Write below the information you collect.
Types of interviews Points to be judged Level of employees
1 .......................... .......................... . .......................... .
2 .......................... .......................... . .......................... .
3 .......................... .......................... . .......................... .
4 .......................... .......................... . .......................... .
5 .......................... .......................... . .......................... .

6.8 PHYSICAL EXAMINATION
Applicant who get over one or more of the preliminary hurdles are sent for a physical
examination either to the organization’s physician or to a medical officer approved for
the purpose.
Purposes: A physical examination serves the following purposes:
i) It gives an indication regarding fitness of a candidate for the job concerned.
ii) It discovers existing disabilities and obtains a record thereof, which may be
helpful later in deciding the campany’s responsibility in the event of a workman’s
campensation claim.
iii) It helps in preventing employment of those suffering from some type of
contagious diseases.
iv) It helps in placing those who are otherwise employable but whose physical
handicaps may necessitate assignment only to specified jobs.
4 6

Contents of Physical Examination: Physical examination covers the following: Attracting the Talent:
l The applicant’s medical history. Outsourcing
l His physical measurements—height, weight, etc.
l General examinatian—skin, musculature and joints.
l Specia1 senses—visual and auditory activity.
l Clinical examinatian—eyes, ears, nose, throat and teeth.
l Examinatian of chest and lungs.
l Check-up of blood pressure and heart.
l Pathological tests of urine, blood etc.
l X-ray examinatian of chest and other parts of the body.
l Neuro-psychiatric examinatian, particularly when medical histary or a
physician’s observations indicate an adjustment problem.
You wauld realize that the importance of these characteristics varies from job to job
and, therefore, different weightages have to be given to each far an overall evaluation.

6.9 REFERENCE CHECKS
The applicant is asked to mention in his application the names and addresses of three
such persons who usually know him well. These may be his previous employers,
friends, or professional colleagues. They are approached by mail or telephone and
requested ta furnish their frank opinion, without incurring any liability, about the
candidate either on specified points or in general. They are assured that all
information supplied would be kept confidential. Yet, often either no response is
received or it is generally a favarable response.

6.10 FINAL DECISION
Applicants who cross all the hurdles are finally considered. If there are more persons
than the number required far a job the best ones, i.e., those with the highest scores are
finally selected.

6.11 PLACEMENT
Sometimes a particular person is selected for a given jab. Often more than one person
may be selected for the jobs of similar nature. In the second case, individual
employees have to be put under individual supervisors with the approval of the latter.
In the first case also his approval is also necessary but it should be done early in the
selection process.
A proper placement reduces employee turnover, absenteeism and accident rates and
improves marale.

6.12 INDUCTION
This is the last activity in relation to a newly employed person before he is trained for
his job.

Meaning
As explained earlier, it is introduction of an employee to the job and the organization.
The primary purpose is to ‘sell’ the company to the new employee so that he may feel
proud of his association with the company. 4 7

Getting Human Purpose and Need
Resources
An employee has to work with fellow employees and his supervisor. For this he must
know them, the way they work and also the policies and practices of the organization
so that he may integrate himself with the enterprise. Any neglect in the area of
induction and orientation may lead to high labour turnover, confusion, wasted time
and expenditure.

Induction Programme
A good induction programme should cover the following:
l The company, its history and products, process of production and major
operations involved in his job.
l The significance of the job with all necessary information about it including job
training and job hazards.
l Structure of the organization and the functions of various departments.
l Employee’s own department and job, and how he fits into the organization.
l Personnel policy and sources of information.
l Company policies, practices, objectives and regulations.
l Terms and conditions of service, amenities and welfare facilities.
l Rules and regulations governing hours of work and over-time, safety and
accident prevention, holidays and vacations, methods of reporting, tardiness and,
absenteeism.
l Grievances procedure and discipline handling.
l Social benefits and recreation services.
l Opportunities, promotions, transfer, suggestion schemes and job satisfaction.
An induction programme consists primarily of three steps:
General orientation by the staff: It gives necessary general information about the
history and the operations of the firm. The purpose is to help an employee to build up
some pride and interest in the organization.
Specific orientation by the job supervisor: The employee is shown the department
and his place of work; the location of facilities and is told about the organization’s
specific practices and customs. The purpose is to enable the employee to adjust with
his work and environment.
Follow-up orientation by either the personnel department or the supervisor: This
is conducted within one week to six months of the initial induction and by a foreman
or a specialist.
The purpose is to find out whether the employee is reasonably well satisfied with him.
Through personal talks, guidance and counselling efforts are made to remove the
difficulties experienced by the newcomer.

6.13 OUTSOURCING
Companies that see outsourcing as a short-term, cost-cutting opportunity are almost
always disappointed with the results. But companies that approach outsourcing as one
element of an overall business strategy are applying some specific best practices to
reach their goals more quickly and with fewer roadblocks.
Communicating openly from Day 1. Companies that develop candid internal
4 8 communication plans about sourcing strategies are far less likely to experience

employee backlash as roles begin to move offshore. Eighty-four percent of the buyers Attracting the Talent:
of outsourcing services in Diamond Cluster’s “2004 Global IT Outsourcing Report” Recruitment, Selection,
Outsourcing
said they are concerned about backlash as jobs are lost to offshore outsourcers. But
those same companies have probably underestimated the ripple effect of their
outsourcing decisions.

Why Outsourcing?
An obvious, primary benefit of outsourcing is the significant cost saving and
improvement to the bottom line. Depending upon the work processes outsourced, some
organizations save up to 60 percent in content development costs alone. Cost savings
may also be realized by outsourcing development and maintenance of e-learning
technologies, such as learning management systems (LMSs), content management
systems (CMSs) and authoring platforms.
Saving costs is not the only reason to consider outsourcing, however. Significant
quality improvements, such as consistent instructional design and ongoing content
maintenance, can also be cost-effectively derived through outsourcing. Many
organizations haven’t built the competencies or processes in-house for developing and
delivering e-Iearning, and this provides a way to provide expertly designed e-Iearning
at a reduced cost.
Also, outsourcing is often used to overcome resource shortages. For example,
countries such as Ireland and India have significant English speaking resources that
can be engaged in the design and development of learning content. A robust
educational system in developing countries, such as India, China and the Eastern
European nations, provides access to highly skilled individuals in the areas of
linguistics, IT and engineering, etc. All these factors add up to allow corporations
access to any content expert with proficient English language skills, at less than half
the cost of similar resources elsewhere.
While organizations are primarily driven to outsource training content development
because of cost savings, the trend to outsource this work to specialist vendors is
heightened by two other reasons-increasing need for content and increased pressure to
improve the quality and consistency of training produced to meet these expanding
requirements.
It’s the classic “more for less” story heard everywhere in organizations today.

Specialized Knowledge
In recent months, some training organizations have seen a shift toward centralized
functions. Centralization has put the onus on training management to ensure that
training is not only the best of breed but is also standardized and consistent in quality.
Therefore, training executives are now working closely with the specialist vendors—
the outsourcing partners to control and maintain quality and consistency of training
material, be it e-learning content or classroom courseware. In addition to improving
training effectiveness, education organizations are also under tremendous pressure to
reduce time-to-train or time-to market.
Outsourcing needs to be implemented as a strategic initiative. The organization needs
to be as prepared to outsource as the vendor is prepared to manage the outsourced
operation.

Size Does Matter
Outsourcing can lead to tremendous cost savings. However, organizations must
remember that cost savings actually build up over time. The potential for cost saving
in the early part of the outsourcing initiative is offset by one-time relationship
4 9

Getting Human establishment costs, initial time lags in development and the possibility of rework until
Resources the relationship between the organization and the vendor matures.
Obviously, the benefit lies in outsourcing medium-to-Iarge contracts. Size matters
because it’s mutually beneficial for the organization and the vendor. The organization
yields a higher buyer bargain, and the vendor gains production efficiencies by reusing
resources, passing the efficiency on to the customer.

Maturity Makes It Easy
Organizations with a clear definition of finished deliverables (the output), well-aligned
resource responsibilities (the process) and requirement acquisition (the input) have
been shown to outsource more effectively than those without a reliable and consistent
work plan that includes elements of all three-the output, the input and the processes.
Organizations can measure the reliability and consistency of their input and output by
using the Outsourcing Maturity Matrix.
In the first wave of e-learning, many organizations bought and invested heavily in e-
learning and training infrastructure. Millions of dollars were invested in the delivery
systems, such as LMS, LCMS and CMS, and in the authoring tools. Just as the
infrastructure was being deployed and the users could be trained, the economy turned
sour. The organizations faced with slashed training budgets were left in a peculiar
situation-they had the vehicle to deliver training, but not enough fuel since they were
left without enough budget to develop significant content. Still other organizations
were slower to adopt e-learning, and when the inevitable budget cutting came, they
were left without the infrastructure or the content.

6.14 ROAD MAP FOR SUCCESSFUL OUTSOURCING
With increasing pressure on training budgets and senior management emphasis on
improved ROI of training infrastructure, outsourcing proves to be the answer for
many organizations. In addition to careful selection of the outsourcing partner,
internal training organizations need to discipline the work plan—the input, the output
and the processes—prior to outsourcing. Even then, this transition from internal
development to outsourced development is fraught with road hazards. Call them
teething pains.
Client organizations can take several steps to minimize, if not completely eliminate,
the road hazards on the path to outsourcing. For first-time offshore outsourcing
clients, reorientation of the internal training organization and selective and/or dual
shore development models are two ways to mitigate the risks.

Reorient, You Must
Success of outsourcing initiatives largely depends upon successful requirements
management and standardization of output. This helps minimize conflict between the
expectation and realization of benefit.
Here, the internal training organization plays an important part in supporting the
outsourcing operations by effectively managing client and vendor processes. In the
absence of outsourcing partners, the role of the internal training organization has been
one of the supplier to the businesses it supports. To ensure a successful outsourcing
relationship, training organizations need to play two roles interchangeably—one of a
supplier to the business users, and another of a customer to the outsourcing partner.
As outsourcing of human resource functions grows; so does the outsourcing industry’s
need for talented HR and benefits experts who can improve how it delivers services to
5 0

clients. Attracting the Talent:
“If even half the projections for growth in HR outsourcing are correct, the industry is Outsourcing
going to need a lot of professionals at all levels of HR experience to help with that
expansion,” says Glenn Davidson, chairman of the HR Outsourcing Association and
Accenture HR Services’ chief of market strategy and corporate development.

Entrepreneurial culture
Part of the appeal for working with an HR outsourcing company is the change in
culture, Davidson says. “You go from being a cost center to being part of the core
business. A whole world of opportunities opens up for you.
“At most companies, the top HR position is senior vice president of human resources,
and there are very few positions out there,” he continues. “In our industry, HR people
have an opportunity to expand their career sphere into marketing, strategy and even be
chief executives at companies because good HR service is our business.”
Rob Ball, chief people officer at Exult, says that certifications and continuing
education are things HR outsourcing companies look for on resumes when hiring.
Also important is “a big-picture sense of how human resources can help large
enterprises.”
To help HR professionals groom themselves for jobs in the industry, Davidson’s
organization is developing a certificate program in HR. “The program is in its early
stage. We are working on a road-show class that we can take companies who are
interested in HR outsourcing, so their employees can learn more about the trends,”
Davidson says. “Pay for HR professionals can be higher at HR outsourcing firms than
in house HR/benefits work, but salaries vary from company to company.”

Davidson says “Rewards can be greater in the HR outsourcing industry for benefit
professionals. It depends on their ability to produce results,” he says. “People who
have great ideas on how to make HR services a better value proposition for large
employers and who can] dramatically improve employee productivity and save money
will be either famous, rich or both.”

6.15 SUMMARY
This unit has helped you to follow the process of selection in an organization right
from the conception of an idea that a susitable person is to be put on a given job to the
point of ultimately selecting the most suitable person for it, putting him at ease and
making him feel at home with his fellow employees, his supervisor and the
organization as a whole. It has helped you to understand the various activities
involved in the process and the order in which these are carried out. It has given you
insight into the various alternatives and methods of various activities and under what
circumstances each is advisable. It has also helped you to realize the various
precautions to be taken so that your efforts under each activity bring desired results.
Also, the importance and function of outsourcing have been discussed.

1) What do you understand by recruitment? Explain the process of recruitment.
2) Discuss critically the various sources of recruitments.
3) Explain the various types of tests used in selection process.
4) What are the objectives of interview? Describe the process of interview.
5) Explain the ‘outsourcing’ function in an organization with suitable examples.
5 1

Getting Human
Resources 6.17 FURTHER READINGS
Fear, Richard A. 1984. ‘The Evaluation Interview’, McGraw-Hill: New York.
Maier, Norman R.F. 1982. ‘Psychology in Industrial Organizations’, Houghton
Mifflin Co.: New York.
Monappa, Arun and Saiyaddain, Mirza S. 1983. ‘Personnel Management’, Tata
McGraw-Hill, Mumbai.
Pigors, P. and Charles, A. Myers. 1981. ‘Personnel Administratio—A Viewpoint and
a Method’, McGraw-Hill: London.
Yoder, Dale and Paul D. Staudohar. 1982. ‘Personnel Management and Industrial
Relations’, Prentice-Hall: Englewood-Cliffs.

5 2

Socialisation, Mobility
UNIT 7 , and Separation

Objectives
, :
l ;
l ;
l ;
l ;
l ;
l .

Structure
7.1
7.2 :
7.3
7.4
7.5
7.6
7.7
7.8
7.9
7.10
7.11
7.12
7.13

7.1 CONCEPT OF ORGANIZATIONAL SOCIALISATION
“Socialisation refers to the process by which persons acquire the knowledge, skills,
and disposition that make them more or less able members of their society”. We have
all undergone this process many times. Certainly, significant socialisation occurs
during infancy and early childhood. We are born into this world with potential for a
very wide range of behaviour, but we learn from our parents and other close
associates to behave within a narrower range that is customary and acceptable. People
face re-socialisation on entering the first grade, joining and athletic team or the scouts,
matriculating into college, and learning their first job. With all of these early
socialisation experience it might be thought that the adult should easily adapt to new
social situations.
Actual and anticipatory socialisation are vitally important in all our lives. However,
we can look in greater depth at one important segment, organizational socialisation. A
person will be directly involved in this process when he/she leaves college and start
working career. Eventually, as managers and professionals, the person will be
responsible for the socialisation of newcomers and subordinates in his/her
organizations. 5 3

Getting Human
Resources 7.2 INDIVIDUAL AND THE ORGANIZATION: THE
PROCESS OF INTEGRATION
The individual joining any organization develops new values, attitudes, and behaviour
appropriate for membership. The problems associated with entrance into and
adaptation to work organizations are issues of adult socialisation. In complex societies
with rapid technological and sociological changes, it is imposible to socialise the
young child to all future roles. Every individual must face continuing resocialisation to
new situations throughout his or her life.
One of the most important periods of adult socialisation is when the individual is on
the boundary of a new organization ready to become a member. Figure 1 illustrates the
individual moving through the boundary to become a member. The diagram is simple
but the process is complex. There is a great deal of difference between being an
outsider looking in and being a full-fledged and accepted member. Most organizations
select individuals who can become members - and require newcomers to behave in
appropriate ways.

Organizational
Boundary

INDIVIDUAL
Values, Beliefs, Process of learning
attitudes, and behaviour and adapting to new
patterns obtained Socialisation Process expectation and
through earlier requirements.
socialisation.

Figure 1: The Socialisation Process

Organizational socialisation — the process of becoming an accepted member is a
reciprocal process; the individual adapts, but so does the organization. Every time an
organization takes in a new member too, is subject to new influences increasing
likelihood of change. For example, the opening up of business and others
organizations to greater participation by women and minorities not only results in the
need to socialise these groups, but also require change in the organizations themselves.
Self-image and Membership
Individuals hold a certain image of themselves when entering the organization. This
undergoes changes and they interact with the organization and learn new tasks and
roles. The new lawyer is likely to have a significantly different self-image after she
has been in the law firm for six months than when she started. Organizational life
gives opportunities to test her knowledge and skills and to assess her own strengths
and weakness.
Membership often requires the development of new values appropriate to the position.
To become a successful members, the individual must accommodate, at least to some
degree, the goals, value and practices of the organization. The new CA fresh from
examination in accounting theory and practice, may have to modify his approach
significantly to fit actual organizational practices.
We have stressed here the initial process of integrating into the organization. But, just
5 4 as in the world at large, the process is never complete. Later on the individual may be

transferred, promoted, move to another organization, or even change careers. Socialisation, Mobility
Technological and structural shifts may occur, task requirements may be modified, and Separation
and social groups may change. All of these changes may require the resocializaton of
the person into a new situation.
Interactions Between Individual and Organization
How many organizations are you member of? How many affect your life in important
ways? These are simple questions but require some though. If you consider all
organizations that have an influence, (direct or oblique) on your life and behavior, the
list would likely be in the hundreds and still probably would not be complete.
For example, in driving to school (an organization of which you are voluntary
member) your behaviour is influenced by the speed limit (a product of
governmental institutions).
Never the Total Person
Although we recognize that we are in constant interaction with organizations, we
should remember that they never encompass the total person. Organizations are
designed to accomplish specific purposes, and they engage only a segment of a person
in accomplishing these objectives. They are most interested in the specific behavior
that affects individual performance in meeting these goals. A person may be a
champion bowler, a great husband and father a member of the church choir, and a
subscriber to Playboy, but these affiliations are likely to be irrelevant to the
organization if his task is to put two bolts on the left front door of the cars
coming down the assembly line. Managers are interested in having individual
adapt their behavior in organizationally relevant matters. Furthermore, the work
situation requires that the individual shape a vast repertoire of potential behaviours
to a narrow range of specific actions. It seeks to utilize only part of a person’s
skills and abilities.
This implies that there is always limited integration or socialisation of the total person
into the organization. “People who perform organizational tasks must be sustained by
factors outside the boundary of the organization. The organization is not the total
world of the individual; it is not a society. People must fulfill other social roles;
besides, society has shaped them in ways which affect their ability to perform
organizational tasks. A man has a marital status, ethnic identification, religious
affiliations, a distinctive personality, friends, to name only a few .... Daily, people
come contaminated into the organization”. (Perrow, 1970).
Never the Total Organization
Just as the Organizational never encompasses the total, the individual does not
comprehend and experience the total organization. The individual’s “organizational
horizon” is limited (Porter, Lawler, & Hackman, 1975). People in organizations have
limited perspectives of the total organization because of differences in hierarchical
level, tasks assigned, departmental affiliations, and interpersonal contacts. Moreover,
different people subject to the same organizational influences may have different
perceptions. It is often starting for professors who receive evaluations of their
courses to find vast differences among individual responses. Some students may
rate their course and instructor as excellent, while others rate it a disaster.
Similarly workers performing the same task and receiving approximately the same
rewards sometimes have significantly different perceptions about the leadership style
and quality of the work environment. It is quite obvious that we perceive and react to
new situations in different ways because of past socialisations to life and our own
personalities.

5 5

Getting Human
Resources 7.3 SELF-CONCEPT AND ORGANIZATIONAL
SOCIALISATION
When joining an organization you are not just selling your physical and mental
abilities. Like it or not, you are also brining along your psychic self in the bargain.
Your own self-concept plays a major part in the socialisation process.
Self-concepts is the way you perceive and judge yourself. It is your way of thinking
about the kind of person you really are. Do you see yourself as a leader or follower?
Do you have high need for power, achievement, or social affiliations? Are you
aggressive or passive? People have the unique capacity for thinking about their own
behavior and their impact on others.
Self-concept is of vital importance in the process of organizational socialisation.
When the self-concept is compatible with one’s organizational role and requirements,
the person is likely to be motivated, oriented to task performance, and satisfied.
However, when self-concept and organizational role are not compatible, then
integration is difficult and motivation, performance, and satisfaction are likely to be
low.
This does not imply that self-concept is totally fixed. Indeed, one of the important
aspects of organizational socialisation is the potential modification in self-concept.
The MBA graduate who thought of herself in passive terms may be thrust into a
leadership position where she is effective and gratified.
Part of the organizational socialisation process may be learning to develop a self-
concept appropriate for the new situation. “Each of us learns to construct somewhat
different selves for the different kinds of situations in which we are called on to
perform, and for the different kinds or roles we are expected to take” (Schein, 1974).
It is unlikely that we can change our basic personalities and value systems
substantially, but we can develop new social selves in terms of new attitudes,
competencies, behavior patterns and ways of relating to others in different situations.
To some extent, we can redesign ourselves to fit the role requirements of new
situations.

7.4 CONCEPT OF ROLE AND ORGANIZATIONAL
SOCIALISATION
The idea of role comes form sociology and it is the pattern of actions expected of a
person in his activities involving others. It arises as a result of the position one
occupied in the social structure as he/she interacts with other people. In order to be
able to coordinate his work with others in an organization, one needs some way to
anticipate their behaviour as one interacts with them. Role performs this functions in
the social system.
A person functions in roles both on the job and away from it, as shown in Figure 2.
One person performs the occupational role of worker, the family role of father, the
social role of club president, and many others. In his various roles he is both buyer
and seller, boss and subordinate, a father and son, and an advisor and seeker of
advice. Each role calls for different types of behaviour. Within the work environment
alone, a worker has more than one role. He may be a worker in group A, a
subordinate of foreman in B, and machinist, a member of a union, and a representative
on the safety committee. Undoubtedly role is the most complexly organized response
pattern of which a human being is capable. Activities of manager and workers a like
are guided by their role perceptions, that is, how they think they are supposed to act in
5 6 a given situation. Since mangers perform many different roles, they must be highly

adaptive in order to change from one role to another quickly. The factory foreman’s Socialisation, Mobility
role particularly requires that he be adaptive in working with the extremes of and Separation
subordinate and superior, staff and line, technical and non-technical, and education
and uneducated.

Figure 2: Each Employee performs many roles

A role set is the entire configuration of surrounding roles as they affect a particular
role, such as the foreman’s role just described. That is, all the different persons with
whom the foreman interacts in this role of foreman have role expectations concerning
the way in which he should act, and these expectations collectively make up the role
set for his role as foreman, this role set arises partlyfrom the nature of the job itself,
because managers in equivalent jobs but in different companies tend to perceive and
play their roles in about the same way.
The existence of role expectations means that a manager or other person interacting
with someone else needs to perceive three role values, and shown interacting with
someone else needs to perceive three role values, as shown in Figure 3 First, he needs
to see his own role as required by the function he is performing. Then he needs to see
the role of the person he contacts. Finally, he needs to see his role as seen by the other
person. Obviously he cannot meet the needs of others unless he can perceive what they
expect of him. Research shows that where there is wide variance in a manager’s role
perception of his job and the employee’s role expectations of that job, there tends to be
poor motivation and inefficiency. They may even have difficulty communicating
because they will not be talking about the same things in the same way. For example,
difficulties may arise because a manager sees his role as that of a hard boiled pusher,
but his employees expect the opposite.
When role expectations of a job are materially different or opposite, the incumbent in
the job tends to be in role conflict because he cannot meet one expectation without
rejecting the other. A president in one company faced role conflict, for example, when
he learned that both the controller and the personnel director expected him to allocate 5 7

Getting Human
Resources Manager Employee
Manager’s perception of Employee’s perception of
his own role his own role

Manager’s perception of Employee’s perception of
employee’s role manager’s role

Manager’s perception of the Employee’s perception of the
manager’s role as seen by employee’s role as seen by
the employee manager

Figure 3: Role Perception of a Manager and an Employee make a
Complex Web as they Interact

the new organizational planning function to their departments. Regarding the existence
of role conflict research suggests that a manager bases his decision primarily on
legitimacy (which expectations he thinks is more “right” and reasonably) and sanction
(how he thinks he will be affected if he follows one expectation in preference to the
other).
In case role expectations are substantially unknown because of poor communication
or are inadequately defined, role ambiguity exists, and it is more difficult to predict
how a person in that role will act.
From a manager’s point of view, a fuller understanding of roles should help him know
what others expect of him and how he should act. Knowing this he should be more
adaptable to each unique role relationship. His decision making should improve
because he will understand why other people are acting the way they are. He will also
recognize the variety of roles each employee plays and will try to provide motivations
and satisfactions for those several job roles.

7.5 STATUS AND SOCIALISATION
The social rank of a person comparison with others in a social system is referred to as
status. Two kinds of status exist: formal and informal. Formal status refers to the rank
of people as designated by the authority structure of an organization. Informal status
refers to the social rank which others accord to a person because of their feelings
toward him. It is the position which one has in an informal social system.
Status relationships need ranking and comparison, so two or more persons are
required to make a status relationship. One must be higher and the other lower.
Individuals are brought together in status systems or status hierarchies, which define
their rank relative to others in the system. The desire for status is one of the strongest
motivation forcing among people at work. The term “lose face” is often used as a
synonym for loss of status in personal interaction, and its seriousness is widely
recognized.
5 8

Status congruence or consistency reflects the degree of agreement among various Socialisation, Mobility
indicators of status for a person. An employee who lacks status congruence is and Separation
regarded with ambiguity and anxiety by those in this group. Usually he is not as well
accepted as people do not know where to place him in their status system. In one
company, for example, a very skilled young toolmaker was added to a department of
older toolmakers. Though his skill merited the status they had, his age did not, and
they would not accept him. He finally chose a different company having some younger
toolmakers.
Loss of status is more than loss of prestige. It seriously affects personality. People,
therefore, become quite responsible in order to protect and develop their status.
Barnard comments, “the desire for improvement of status and especially the desire to
protect status appears to be the basis of a sense of general responsibility.”
Status is important only in the particular social group where the status is accorded,
rather than being some general characteristic which goes wherever a person goes. One
executive recently told how he worked hard for a promotion and the status it would
bring him with his friends. The promotion finally came, but it required him to move
another city where he was unknown. He said that the promotion was hollow because
in this new location his new friends were his peers and looked on him as “just another
manager.” The importance of status ‘requires management to give attention to how it
arises and whether management actions affect it. Some of the status influences which
arise from organization are organizational level, type of work and skill in it, working
conditions, pay, seniority, education etc.

7.6 SOCIALISATION FACTORS IN ORGANIZATIONAL
SOCIALISATION
People coming into organization are not like raw material inputs possessing rigid
specifications. No amount of quality .control and inspections will ensure that they are
99.99% perfect and uniform. They are individuals influenced by hereditary factors,
previous socialisation processes, and their other life experiences. In the socialisation
process, organizations are working with highly variable, heterogeneous, and somewhat
imperfect human resources. To the extent that individuals have faced significantly
different acculturation processes in their earlier lives, they represent different inputs to
the socialisation process. Many studies have indicated that workers coming from
different communities (rural versus urban), from different social classes, or who are in
other ways differentiated by past socialisation have different expectations,
motivations, behaviors, and satisfactions. These groups represent subcultures that
prepare people differently for functioning in work organizations. Looking at these
subcultures may help us understand some of the problem that result from variations in
social learning among societies or among subgroups within a society (Nord, 1976).
Influence of Subcultures Relevance for Gender and Minority Issues
The phenomenon of socio-cultural divergence can be illustrated by looking at two
groups in the work force: women and minorities. We are born into two broad
subcultures based on gender—male or female. These are obvious physiological
differences, but how much these contribute to later differences in the behavior men
and women is the subject of much controversy. A good deal of evidence suggests that
much dissimilarity occurs because of different socialisation process for girls and boys.
There appear to be rather clearly defined sex role stereotypes of men and women
(Broverman et al., 1972). The young girl or boy is socialised to match these
stereotypes. Some of the major components of personality characteristics, interests,
and behaviors as appropriate for one sex or the other; (2) sex roles are systematically
inculcated in individuals, beginning at birth, by parents, the educational system, peers, 5 9

Getting Human the media, religious institutions, and other informational sources; (3) individuals learn
Resources appropriate sex roles through role models and differential reinforcement; (4) sex roles
form the core of an individual’s identity or self image; and (5) in many societies the
male role enjoys the higher status.
Stereotypical masculine traits (more logical, objective, aggressive, and ambitious as
well as less sensitive, warm, and expressive) are often perceived to be more desirable
for mature adults than stereotypical feminine characteristics (more emotional,
sensitive, and expressive as well as less aggressive, objective, and standards exist for
women than for adults. If women adopt the behaviors specified as desirable for
adults, they risk censure for their failure to be appropriately feminine; but if they
adopt the behaviors that are designated as feminine, they are necessarily
deficient with respect to the general standards for adult behaviour”
(Broverman et aI., 1972, p. 75).
It also leads to additional problems for women seeking to rise in the organizational
hierarchy to managerial positions. The effective manager is seen to have those traits
most closely associated with the masculine (and adult) sex role. The aspiring women
generally must assume some of these traits if she is to be successful in a managerial
position. However, the more aggressive women is often described as pushy, ruthless,
and domineering. An aggressive man, behaving in essentially the same way, is called a
“go-getter” or a “take-charge guy.” If a women behaves in the stereotypical feminine
manner, she is likely to be considered overcautious, incapability of decisive action,
and too emotional.
There are further indications that other factors in organizations contribute to the
problem, such as differential recruitment of women to lower-level jobs that require
dependence and passivity and excessive control that give women less power
(Acker & Van Houten, 1974). Taken together, past socialisation into differentiated
sex roles and conditions within organization that reinforce these differences create
unique problems of socialisation—both for the woman and the organization. It takes
much more than just saying, “We are opening the doors” to reach a successful
accommodation.
It is very important for the organization and the manager not to fall into habits of
stereotyping different subcultures. Many people associate certain personality traits
with different groups in our society. Sometimes this is useful, but more likely we find
that it blinds us to really understanding the individual as the unique human being.
Often, with better information we find that there are not as many differences as we
expected.
There is an additional key factors when considering the socialisation process for
women and minorities entering into new, higher-level positions in organizations.
This is not only process of change for the newcomer, but something requiring
significant resocialisation of existing members. Not only are we modifying the
values, attitudes, and behavior of the new employee, we are also asking for
substantial change on the part of others in the organization. This makes the
process even more difficult.
Cross-cultural Comparisons
Early socialisation processes deeply affect the expectations and behaviour of a
particular people. For example, in Japan the Nenko system of lifetime commitment to
and organization is often associated with centuries old behavior pattern and value
orientations. This system is based on traditional Japanese values of respect for elders,
the importance of family and group social systems, and mutual responsibility, loyalty
and collaboration. However, the Nenko system is not universal in Japan. It is used
only in the larger enterprise and does not cover temporary employees and outside
6 0 contract workers.

This system does appear to work well within the culture, but there are major questions Socialisation, Mobility
about its appropriateness in other societies, such as the United States. The reverse of and Separation
this is also true: many modern U.S. Corporate practices are not easily transferred to
other countries. This becomes particularly evident in multinational corporations
operating in a foreign country. In the organizational socialisation process abroad, we
may find that we are requiring people to develop attitudes, values, and behavior
patterns that are in conflict for the individual.
As we develop more varied and complex organizations and recruit people from
different subcultures, we can anticipate that the socialisation process will become
even more complex. Not only must individuals adjust, but the organization will have
to adapt to the attitudes, beliefs, and behavior patterns that different people bring into
the organization. We see an increasing possibility of having more diverse values,
views, and even life styles among different participants and groups within
organizations.

7.7 IMPORTANCE OF INITIAL JOB SOCIALISATION
Some people believe that the period of early organizational socialisation is not
particularly important. The newcomer is there to get acquired with the organization, to
learn about the task requirements, and to size up the situation without too much
involvement. The organization should look the newcomer over and really not expect
much. The newcomer should play it cool and not make too many commitments to the
organization.
There is very strong evidence that this approach is inappropriate for the individual and
the organization. The first year is one of the most significant periods in the work
career of the individual. The development of values, attitudes, and behavior patterns
during this period strongly influences future career development.
Why is this so? There is a low of primacy which holds that the earlier an experience,
the more important its effect because it influences how later experiences will be
interpreted. The newcomer entering the organization is uniquely subject to new
influences. When he enters the organization he is uncertain about the role that he will
play and his concept of himself is thrown into question. Finding himself in a stressful
and “unfrozen” situation, “he is motivated to reduce this stress by becoming
incorporated into the ‘interior’ of the company. Being thus motivated to be accepted
by this new social system and to make sense of the ambiguity surrounding him, he is
more receptive to cues from his environment than he will ever be again, and what he
learns at the beginning will becomes the core of his organizational identity” (Berlew &
hall, 1966). This is the very period when recruits can best test their own self-concepts
and expectations of organizational life. It is during this time when the most important
components of the psychological contract will be negotiated, thus determining the new
recruit’s organizational commitment. The researches have shown that very early in his
organizational career an individual will develop enduring attitudes and aspirations
which will have development opment of performance standards and job attitudes.
From the moment he enters the organization, a new manager is given cues about the
quality of performance that this expected and rewarded A few studies have confirmed
that managers given challenging initial jobs with high expectations jobs. They were
socialised to have higher aspirations and performance standards. The moral seems to
be that “success breeds success”; numerous other studies seem to confirm the findings
(Buchanan, 1974). Newcomers should thus be given challenging but obtainable goals
rather than “snap assignments.” They should be involved in the establishment of these
goals and be given honest feedback on performance.

6 1

Getting Human The Organization Sizing up the Individual
Resources
We have emphasised the importance of the initial socialisation process in establishing
the individual’s values, expectations, behavior patterns, and achievement orientation.
The other side of the coin is also apparent. It is during this period that other members
of the organization are making key judgment about the personal characters, behavior,
and performance of the new individual. Initial impressions (which may be based in
limited evidence) are long lasting. Just as in Hollywood, there is a danger that the
individual may become type-cast and it is often difficult to break out of this role in the
future. The new instructor will often be judged by faculty colleagues as to classroom
effectiveness early in her career. Quite often these perceptions are based on limited
information, but they are enduring and difficult to change. The first day and the first
few months really do count in the individual’s organization career.
Matching of Individual and Organization
In view of the large variations in individual personality characteristics and almost
equally wide different in organizational climates, it is understandable that there are
many problems in appropriately matching and integrating the individual and the
organization.
Frequently both the individual and the organization have some influence in the
selection process. The corporation recruits, interviews, tests, and selects from a
number of candidates. The individual investigation has the most say in the matching
process, the individual investigates and evaluates various job opportunities. In some
situations, the organization has the most say in the matching process, the individual,
little.
In most cases, however there is a potential opportunity for selection and matching on
the part of both the individual and the organization to increase the probability of more
effective socialisation and integration.
People Do Change Organizations
Socialisation is a two-way process. It is fairly obvious to new parents, for example,
that their lives have been changed significantly when they bring the first baby home
from the hospital. And they continually modify their behaviour as the infant passes
through various stages of childhood. The teacher makes certain attitudinal and
behavior adjustments for each new class. The manager adapts to the new employee.
All agents of socialisation are therefore themselves subject to change as a result of this
process.
The degree of change effected in organization and in their agents of socialisation is
directly related to the novelty to the situation with which they are presented. The first
child is much more likely to change the parents than the tenth. The young teacher is
more likely to be changed than the veteran. However, even the long-established
organization member may face a period of significant re-socialisation when presented
with new circumstances. Examples of the introduction of women and minorities into
higher position in work organizations illustrate that the established managers also
undergo major readjustments. The first women in the military academies were not only
called upon to change themselves but occasioned substantial change that affected other
recruits and the entire organization.
Agents of socialisation (parents, peers, teachers, mangers, etc.) faced with different
types of human inputs into the organization will themselves have anxieties and
apprehensions about the process; they may behave much like the newcomer. They are
facing a new social situation and to an extent are unfrozen from their past attitudes
and behavior patterns. They, too, are more receptive at this time to information inputs
and cues about how they should perform their role as socialiser.
6 2

Individualization is the reciprocal of socialisation. While the organization is Socialisation, Mobility
attempting to modify the individual to its requirements, “he in turn is striving to and Separation
influence the organization so that it can better satisfy this own needs and his own ideas
about how it can best be operated” (Porter, Lawler, & Hackman, 1975). This
individualization process is of vital importance to the long-term survival of
organizations: particularly those facing rapidly changing environments and internal
circumstances. It is one of the primary sources of organizational change and
adaptation.

7.8 IMPROVING THE SOCIALISATION PROCESS
There seem to be some broad generalisation coming out studies of organizational
socialisation process (Van Maanen & Schein, 1979). First, there is strong evidence
that anticipatory socialisation leads to higher expectations on the part of individuals
about their organizational roles than can be fulfilled. There seems to be a downward
adjustment of expectations and aspirations on the part of new members in the
organization during their first year. This appears to be true for college graduates
entering management training programs, for police trainees, and for many professional
(Van Maanen, 1975). High initial expectations leading to some disillusionment is the
typical pattern.
This may be caused by many factors. The graduate business school that prepares its
MBA graduates to fill high managerial positions later in their career may install
expectations that cannot be met until the individual has earned this position by
performing basic tasks. Unrealistic expectations may also be created in many
industrial jobs. For example, one large organization established a magnificent training
facility for workers just joining the organization. The learning environment was ideal,
the instructors, capable and the training program highly effective. Unfortunately, when
the trainees were assigned to the gritty realities of the shoproom floor, many became
disillusioned and quit.
With the opening of new positions to women and minorities we see many examples of
unrealistic expectations on the part of both the individual and the organization. For
example, when a university department hired its first black assistant professor it
painted a rosy picture of academic life. The professor also put his best foot forward.
However the department failed to specify clearly all of the expectations for teaching
and research of a new assistant professor. Even more critical, it did not fully recognize
the potential role conflicts that the new professor would face.
The Individual Perspective—Realistic Career Planning
The individual should be realistic in recognizing that entering any organizations
entering any organization entails some personal gains and some loses. Every adult
re-socialisation process requires the abandonment of certain past values, attitudes, and
behaviour patterns that may have been part of the self-image cultivated by the
individual. We should not expect the process to be easy.
During the selection process, the individual should obtain as much information as
possible about the organizational climate and its effect on the definition or roles.
Recruiters, in their zeal to attract best new members, are not always the best source
for this kind of information. A more objective appraisal may come from those who
have recently joined the organization. This is not always easy to obtain (it is even
more difficult to get information from those who were dissatisfied and left). But it is
important to investigate longer-range career opportunities as well as immediate
rewards, such as salary and fringe benefits.

6 3

Getting Human Organizational Perspective—Initial Socialisation
Resources
Certainly, more balanced recruitment and selection techniques can ease the
socialisation process. Some organizations have attempted to provide the prospective
employee with more realistic job previews in the form of booklets, films, visits, to the
work site, and informal discussion that convey not only the positive side of
organizational life, but some of the potential problems and frustrations as well (Hall &
Hall, 1976; Wanous, 1980; Feldman, 1976). The recruiters fear that this might put of
the better candidates have proven unjustified, and research indicates that turnover and
dissatisfaction are significantly lower for people who have received realistic
information and expectations.
Organizational socialisation can be underdone, appropriately done, or overdone
(Schein, 1968). If it is underdone, appropriately done, rebellion and alienation on the
part of the individual who rejects all the norms and values of the organization. The
rebellious individual is dissatisfied with both himself and the organization: where the
individual totally conforms to the organization, unquestioningly perpetuating and
demanding acceptance of existing goals, values, and practices. The goal of
appropriate socialisation should develop creative individualism where the person
generally accepts the key goals, values, and norms of the organization but also retains
the desire to seek changes and improvement.
Fortunately, there is growing attention to organizational socialisation process, both by
researches and practicing managers (Van Maanen, 1978). The importance of these
processes is becoming more evident in term of both organizational performance and
human satisfaction.
Figure 4 provides a summary diagram of the organizational socialisation process. It
starts with the past life experiences of the individual and the past experiences and
practces of the organization. Clearly, these have a major influence on the process. The
diagram suggests that both the individual and the organization bring a number of
requirements, constraints, and expectations into the process. The socialisation process
requires significant adaptations on the part of both and results in the negotiation of a
psychological contract. The outcome of the process may lead to two failures-
alienation/rebellion or ultraconformity. Neither of these is desirable from either the
individual’s or the organization’s standpoint. Creative individualism is the desired
mean: the achievement of which has great importance for the career development of
the individual and for the continued growth, change, and development of the
organization.

7.9 CONCEPT OF MOBILITY
Mobility is an organizational activity to cope with the changing organizational
requirements like change in organizational structure, fluctuation in requirement of
organizational product, introduction of new method of work etc. Mobility in an
organizational context includes mainly ‘promotion’ and ‘transfer’. Sometimes,
‘demotion’ also comes under mobility.

Purposes of Mobility
Mobility serve the following purposes:
a) To improve organizational effectiveness;
b) To maximise employee efficiency;
c) To cope with changes in operation; and
6 4 d) To ensure discipline.

Past life Self-concept values,
experience attitudes, behaviour
patterns, and
expectations
Rebellion (Counter dependency)
Search and
Expectations selection
Needs and
abilities about
organizations Creative
Socialisation Process individuals
Learning mutual expectations and in (Interdepen-
making adjustments dency) Future
Ascribing and taking roles Outcomes individual
Organization Negotiating the psychological career and
system contract organization
Developing expectations about the Ultra development
effort-performance-rewards-satisfaction conformity
Past relationship
(dependency)
experiences Techno- Goals and Task and Providing feedback on performance
logy values Expectations Developing new self-concepts
and practice other about Search and
requirement Individual selection
Managerial
system

Structure Psychological
reasoning

Figure 4: Diagram of the Organizational Process

6 5
and Separation

Getting Human Promotion
Resources
In simpler terms, promotion refers to upward movement in present job leading to
greater responsibilities, higher status and better salary. Promotion may be temporary
or permanent depending upon the organizational requirement. According to Clothier
and Spriegel, “promotion is the transfer of an employee to a job which pays more
money or one that carries some preffered status.”

Purpose and Advantages of Promotion
Promotion stimulates self-development and creates interest in the job. According to
Yoder, “promotion provides incentive to initiative, enterprise and ambition; minimises
discontent and unrest; attracts capable individuals; necessitates logical training for
advancement and forms an effective reward for loyalty and cooperation, long service
etc.” The purposes and advantages of promotions are to:
a) recognize employee’s performance and commitment and motivate him towards
better performance;
b) develop competitive spirit among employees for acquiring knowledge and skills
for higher level jobs;
c) retain skilled and talented employees;
d) reduce discontent and unrest;
e) utilise more effectively the knowledge and skills of employees; and
f) attract suitable and competent employees.

Types of Promotions
Different types of promotions are discussed below.
a) Multiple Chain Promotion: It provides a systematic linkage of each position to
several others. It provides multi-promotional opportunities through clearly
defined avenues of approach to and exit from each position in the organization.
b) Up or Out Promotion: In this case, an employee either earns a promotion or
seeks employment elsewhere. Out promotion usually leads to termination of
employee and joining some other organization in a better position.
c) Dry Promotion: In this type, promotion is given in lieu of increase in salary. For
example, when an university professor is made Head of the Department, there is
no increase in salary.

Promotion Programme and Procedure
Every organization should make advance plans for promotion programme. A carefully
planned promotion programme has four elements: a) formulation of promotion policy,
b) identification of promotion channels, c) promotion appraisal, and d) centralised
records.
We shall discuss each element in detail.
a) Formulation of Promotion Policy: Each organization needs to maintain a
balance between the internal sources of personnel promotion and external
sources by means of recruitment. Hence, promotion must be based on consistent,
fair and clear cut policy. The National Institute of Personnel Management
(NIPM) has suggested a promotion policy on the following lines:
1) Encouragement of promotion within the organization instead of looking
outside to fill vacancies in higher places.
6 6

2) An understanding that ability as well as seniority will be taken into account Socialisation, Mobility
in making promotions. Ability, efficiency, attitude, job performance, and Separation
physical fitness, leadership, experience, and length of service are some of
the factors considered in making promotions.
3) Drawing up an organization chart to make clear to all the ladder of
promotion. Where there is a job analysis and a planned wage policy, such
chart is quite easy to prepare.
4) Making the promotion system clear to all concerned who may initiate and
handle cases of promotion. Though departmental heads may initiate
promotion, the final approval must lie with the top management, after
the personnel department has been asked to check from its knowledge
whether any repercussion is likely to result from the proposed
promotion.
5) All promotions should be for a trial period to ascertain whether the
promoted person is found capable of handling the job or not.
Normally, during this trial period, he draws the pay of the higher
post, but it should be clearly understood that if “he does not make the
grade” he will be reverted to his former post and former pay scale.
b) Promotion Channels: Promotion channels should be identified and recorded on
paper. This process is related with job analysis and career planning of an
organization.
c) Promotion Appraisals: The promotion of an employee is entirely dependent
upon his/her performance appraisal outcome.
d) Centralised Records: The education, experience, skills, abilities and evaluation
of all employees should be recorded and maintained in a centralised manner by
the department of the organization, because basing on these attributes, promotion
is given to an employee.

Bases of Promotion
Promotion is given on the basis of seniority or merit or a combination of both. Let us
discuss each one as a basis of promotion.
Seniority as a basis: It implies relative length of service in the same organization. The
advantages of this are: relatively easy to measure, simple to understand and operate,
reduces labout turnover and provides sense of satisfaction to senior employees. It has
also certain disadvantages: beyond a certain age a person may not learn, performance
and potential of an employee is not recognized, it kills ambition and zeal to improve
performance.
Merit as a basis: Merit implies the knowledge, skills and performance record of an
employee. The advantages are: motivates competent employees to work hard, helps to
maintain efficiency by recognizing talent and performance. It also suffers from certain
disadvantages like: difficulty in judging merit, merit indicates past achievement, may
not denote future potential and old employees feel insecure.
Seniority-cum-Merit as basis: As both seniority and merit as basis suffer from
certain limitations, therefore, a sound promotion policy should be based on a
combination of both seniority and merit. A proper balance between the two can be
maintained by different ways: minimum length of service may be prescribed, relative
weightage may be assigned to seniority and merit and employees with a minimum
performance record and qualifications are treated eligible for promotion, seniority is
used to choose from the eligible candidates.

6 7

Getting Human
Resources
a) Note down the promotion policy of a Government organization, a Public Sector
Undertaking and Private organization with which you are familiar.

.....................................................................................................................................

.....................................................................................................................................
.....................................................................................................................................
.....................................................................................................................................
b) Make a comparison of the above mentioned three.
.....................................................................................................................................
.....................................................................................................................................
.....................................................................................................................................
.....................................................................................................................................

Promotion Practice in India
In India, seniority is generally used for promotion in Government offices. In public
sectors, both seniority and seniority-cum-merit promotion system is carried based on
their policy. In private sectors, the policy by and large is ‘promote the best man
available’.

Demotion
Demotion refers to the lowering down of the status, salary and responsibilites of an
employee. Demotion is used as a disciplinary measure in an organization. The habitual
patterns of behaviour such as violation of the rules and conduct, poor attendance
record, insubordination where the individuals are demoted. Beach (1975) defines
demotion as “the assignment of an individual to a job of lower rank and pay usually
involving lower level of difficulty and responsibility”.

Causes of Demotion
Demotion may be caused by any of these factors:
a) Adverse business conditions: Employees may be demoted because of recession
faced by company.
b) Incompetency of the employee: It happens when an employee finds it difficult to
meet the required standard.
c) Technological changes: When employee is unable to adjust with any
technological change made by the company.
d) Disciplinary measure.

Yoder, Heneman, Turnbull and Stone (1958) have suggested a five fold policy with
regard to demotion practice.
i) A clear and reasonable list of rules should be framed, violations of which would
subject an employee to demotion;
ii) This information should be clearly communicated to employees;
iii) There should be a competent investigation of any alleged violation;
iv) If violations are discovered, there should be a consistent and equitable
6 8 application of the penalty, preferably by the immediate supervisor;

v) There should be a provision for review. (In a unionised case, this will be Socialisation, Mobility
automatic via the grievance procedure; in a non-unionised case, the employer and Separation
will need to make other provisions for review).
Activity B
Take on account of the demotion policy of your organization and give a brief note on
that.
............................................................................................................................................................................

............................................................................................................................................................................

............................................................................................................................................................................

............................................................................................................................................................................

Transfer
A transfer is a horizontal or lateral movement of an employee from one job, section,
department, shift, plant or position to another at the same or another place where his
salary, status and responsibility are the same. Yoder and others (1958) define transfer
as “a lateral shift causing movement of individuals from one position to another
usually without involving marked change in duties, responsibilities, skills needed or
compensation”. Transfer may be initiated either by the company or the employee. It
also can be temporary or permanent.

Transfers are generally affected to build up a more satisfactory work team and to
achieve the following purposes;
i) To increase the effectiveness of the organization
ii) To increase versatility and competence of key positions
iii) To deal with fluctuations in work requirements
iv) To correct incompatibilties in employee relations
v) To correct erroneous placement
vi) To relieve monotony
vii) To adjust workforce
viii) To punish employees

Types of Transfers
Employee transfers may be classified as below.
a) Production transfers: Such transfers are made to meet the company
requirements. The surplus employees in one department/section who are efficient
might be absorbed in other place where there is a requirement. Such transfers
help to stabilise employment.
b) Replacement transfers: This takes place to replace a new employee who has
been in the organization for a long time and thereby giving some relief to an old
employee from the heavy pressure of work.
c) Versality transfers: It is also know as rotation. It is made to develop all round
employees by moving them from one job to another. It also helps to reduce
boredom and monotony.
d) Personnel or remedial transfers: Such a transfer is made to rectify mistakes in
selection and placement. As a follow up, the wrongly placed employee is
transferred to a more suitable job. 6 9

Getting Human e) Shift transfers: This is pretty common where there is more than one shift and
Resources when there is regularised rotation.

Transfer Policy
Every organization should have a fair and impartial transfer policy which should be
known to each employee. The responsibility for effecting transfers is usually entrusted
to an executive with power to prescribe the conditions under which requests for
transfers are approved. Care should be taken to ensure that frequent or large-scale
transfers are avoided by laying down adequate selection and placement procedures for
the purpose. A good transfer policy should:
i) Specifically clarify the types of transfers and the conditions under which these
will be made;
ii) Locate the authority in some officer who may initiate and implement transfers;
iii) Indicate whether transfers can be made only within a sub-unit or also between
departments, divisions/plants;
iv) Indicate the basis for transfer, i.e., whether it will be based on seniority or on
skill and competence or any other factor;
v) Decide the rate of pay to be given to the transferee;
vi) Intimate the fact of transfer to the person concerned well in advance;
vii) Be in writing and duly communicated to all concerned;
viii) Not be made frequently and not for the sake of transfer only.

Activity C
Present a brief not on the transfer policy of your organization along with citing the
total number of transfer cases of last few years.
............................................................................................................................................................................

............................................................................................................................................................................

............................................................................................................................................................................

............................................................................................................................................................................

7.10 SEPARATIONS
Separation means cessation of service with the organization for one or other reason. It
may occur due to resignation, retirement, dismissal, suspension, layoff or death.

a) Resignation
Resignation or quit is a voluntary separation initiated by the employee. It may be on
grounds of health, marriage, better opportunities elsewhere or may be compulsory
when an employee is asked to resign to avoid termination. Some resignations may
enable the organization to rectify mistakes in hiring of employees and to bring in fresh
talent from outside. However, excess turnover is costly for the organization. Hence, to
find out the real causes of resignation so that appropriate actions may be taken to
prevent avoidable resignations, HR department conduct ‘Exit Interview’ with the
employee who is leaving the organization. The main requirements of a successful exit
interview are as following:
i) Win the employee’s confidence by assuring him that whatever he says will be
7 0 kept strictly confidential.

ii) Explain to the employee that the purpose of the interview is to improve the Socialisation, Mobility
organization’s climate. and Separation

iii) The interview should be conducted by a responsible officer from the personnel
department.
iv) The interview should show a great deal of patience and listen sympathetically.
v) Try to find out the real cause of resignation and ensure that the employee has
fully handed over the charge to somebody else.
vi) Assure the employee of the company’s continuing interest in his welfare.

b) Retirement
Retirement is a significant milestone in the life of an employee. It is the main cause of
separation of employees from the organization. Retirement is of three kinds:
i) Compulsory Retirement: An employee must retire after attaining the specified
age. In Government office the retirement age is 58 years whereas in the private
sector the age is generally 60 years.
ii) Premature Retirement: An employee may retire before attaining the specified
age due to bad health, physical disability, family problem, etc. He gets the full
benefit of retirement provided the management allows premature retirement.
iii) Voluntary Retirement: When an organization wants to cut down its operations
or to close forever, it may give an option to its employees with a certain
minimum service for voluntary retirement in return for a lumpsum payment. This
type of retirement is called Golden Hand Shake.

c) Dismissal
Dismissal is the termination of services of an employee by way of punishment for
misconduct or unsatisfactory performance. It is a drastic step taken by employer. The
principle of natural justice is followed for this. Before dismissal, an employee is given
an opportunity to explain his conduct and to show cause why he should not be
dismissed.

d) Suspension
Suspension is a serious punishment and is generally awarded only after a proper
enquiry has been conducted. For reasons of discipline, a workman may be suspended
without prejudice during the course of an enquiry. During suspension, the employee
receives a subsistence allowance.

e) Retrenchment
Retrenchment means permanent termination of service of an employee for economic
reasons in a going concern. The Industrial Disputes Act, 1947 defines retrenchment as
the “termination by the employer of the services of workman for any reason other than
termination of services as punishment given by way of disciplinary action, or
retirement either voluntary or reaching age of superannuation, or continued ill-health
or the closure and winding up of a business”. The Act lays down the following
conditions for retrenchment.
i) The employee must be given one month’s notice in writing indicating the reasons
for retrenchment or wages in lieu of such notice.
ii) The employee must be paid compensation equal to 15 days for every completed
year of service.
7 1

Getting Human iii) Notice in the prescribed manner must be served on the appropriate Government
Resources authority.
iv) In the absence of any agreement to the contrary, the worker employed last must
be terminated first.
v) Retrenched workers must be given preference in future employment.

f) Layoff
Layoff implies temporary removal of an employee from the payroll of the organization
due to circumstances beyond the control of the employer. It may last for an indefinite
period. But the employee is not terminated and is expected to be called back in future.
The employer employee relationship does not come to an end but is merely suspended
during the period of layoff. It is temporary denial of employment. The purpose of
layoff is to reduce the financial burden on the organization when the human resources
cannot be utilized profitabily. Under Section 2(KKK) of the Industrial Disputes Act,
1947, layoff is defined as “the failure, refusal or inability of an employer, on account
of shortage of coal, power or raw materials or accumulation of stocks or breakdown
of machinery or by any other reason, to give employment to a workman whose name
appears on the muster rolls of his industrial establishment and who has not been
retrenched”. Layoff is restored in cyclical and seasonal industries. In mines workers
are laid off due to excess of inflammable gas, flood, fire and explosion.
According to Section 25(c) of the Industrial Disputes Act, 1947, a laidoff worker is
entitled to compensation equal to 50 per cent of the basic wages and dearness
allowance that would have been payable to him had he not been laidoff. However, in
order to claim this compensation, the laidoff workman must satisfy the following
conditions:
a) he should not be a badli or a casual worker,
b) his name must appear on the muster rolls of the industrial establishment,
c) he must have completed not less than one year of continuous service, and
d) he must present himself for work at the appointed time during normal working
hours at least once a day.
The right to compensation is lost if the worker refuses to accept alternative
employment at a place within 5 miles of the establishment from which he has been laid
off. No compensation is payable when the layoff in due to strike or slowing down of
production on the part of workers in another part of the establishment. An industrial
establishment of a seasonal character or in which work is performed only
intermittently or which employs less than 20 workers is not required to pay the
compensation.

7.11 SUMMARY
To sum up, in this unit we have discussed three important functions of an
organisation: Socialisation, Mobility and Separation. We have touched upon the
individual role and job concept of socialisation. Mobility is the transfer of employees
to cope up with changing organisational requirements. Mobility takes place in
different forms like promotion, transfer and demotion. Separation means cessation of
service for organisational or personal or some other reason. It may occur due to
resignation, retirement, dismissal, suspension, lay off or death.

7 2

7.12 SELF ASSESSMENT QUESTIONS and Separation

1) What does one gain by perceiving organizations as social systems?
2) Discuss how motivation patterns, role, and status have influenced your
interactions with others today. What is your primary motivation pattern?
3) Discuss the statement: A manager cannot satisfy a worker only as an “employee”
because each worker has many work roles.
4) From your experience cite examples of poor status congruence.
5) Compare the ideas of system equilibrium and employee adjustment.
6) Define distributive justice and its relation to lay off.

Adams, J.S. (1965). Inequity in Social Exchange, In L. Berkowitz (Ed.), Advances in
Experimental Social Psychology (Vol. 2, pp. 267-299).
Bies, R.J. & Shapiro, D.L. (1987). Interactional fairness judgments: The influence of
casual accounts. Social Justice Research, 1, 199-218.
Beach, D.S. (1979). Personnel: The Management of People at Work, McMillan
Publishing Co., New York.
Brockner, J., Davy, J. & Carter, C. (1985). Layoffs, self-esteem, and survivor guilt:
Motivational, affective, and attitudinal consequences. Organizational Behaviour and
Human Decision Process, 36, 229-224.
Brockner, J., Grover, S., Reed, T., De Witt, R., & O’Malley, M. (1987). Survivors
reactions, to layoffs; We get by with a little help for our friends. Administrative
Science Quarterly, 32, 526-541.
Clothier, S.W. and Spriegel, W. (1977). Personnel Management: Principles, Practices
and Point of View, Tata McGraw Hill, New Delhi.
Deutsch, M. (1985). Distributive justice: A social-psychological perspective. New
Haven, CT: Yale University Press.
Feldman, Danier C. “A Practical Program for Employee Socialisation,”
Organizational Dynamics 5/2 (Autumn 1976): 64:80.
Greenberg, J. (1982). Approaching equity and avoiding inequity in groups and
organizations. In J. Greenberg & R.L. Cohen (Eds), Equity and justice in social
behaviour (pp. 389-435). New York: Academic Press.
Greenberg, J. (1986a). Determinants of perceived fairness of performance evaluations.
Journal of Applied Psychology, 71, 340-342.
Greenberg, J. (1987a). Using diaries to promote procedural justice in performance
appraisals. Social Justice Research, 1, 219-234.
Levinson, Harry. The Exceptional Executive: A Psychological Conception.
Cambridge, Mass.: Harvard University Press, 1968.
Nord, Walter R. “Culture and Organization Behaviour,” In Concepts and Controversy
in Organizational Behaviour. 2nd ed., pp. 197-221, Santa Monica, California:
Goodyear, 1976.
NIPM, Personnel Management in India, pp. 212-13.
Schien, Edgar H. “Organizational Socialisation and the Profession of Management.”
Industrial Management Review 9/2 (Winter 1968): 1-16. 7 3

Getting Human Van Maanen, John and Edgar H. Schein, “Toward a Theory of Organizational
Resources Socialisation.” In Barry M. Staw (ed.), Research in Organizational Behaviour,
pp. 209-264. Greenwich, Conn: JAI Press, 1979.
Wanous, John P. Organizational Entry: Recruitment, Selection and Socialisation of
New Comers. Reading Mass.: Addison-Wesley, 1979.
Yoder, Dale (1977). Personnel Management and Industrial Relations, Prentice Hall of
India, New Delhi.
Yoder, D.; Heneman, H.G.; Turnbull, H.G. and Stone, C.H. (1958). Handbook of
Personnel Management and Labour Relations, McGraw Hill, New York.
Sarma, A.M., Personnel and Human Resource Management, Himalaya Publishing
House, 1998.
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Mamoria, C.B. & S.V. Gankar, Personnel Management, Himalaya Publishing House,
2004.

7 4

Past life Self-concept values,
experience attitudes, behaviour
patterns, and
expectations
Rebellion (Counter dependency)
Search and
Expectations selection
Needs and
abilities about
organizations Creative
Socialisation Process individuals
Learning mutual expectations and in (Interdepen-
making adjustments dency) Future
Ascribing and taking roles Outcomes individual
Organization Negotiating the psychological career and
system contract organization
Developing expectations about the Ultra development
effort-performance-rewards- conformity
Past satisfaction relationship
(dependency)
experiences Techno- Goals and Task and Providing feedback on performance
values Expectations Developing new self-concepts
and practice logy other about Search and
requirement Individual selection
Managerial
system

Structure Psychological
reasoning

Competency Mapping
UNIT 8 COMPETENCY MAPPING
Objectives
l understand the concept of job analysis;
l explain the competency approach to job analysis;
l describe the meaning of competency mapping and various methods involved
in it; and
l appreciate the benefits of competency mapping.

Structure
8.1 Introduction
8.2 Competency Approach to Job Analysis
8.3 Uses of Competency Approach in an Organisation
8.4 Benefits of the Competency Approach
8.5 Competency Mapping
8.6 Methods of Competency Mapping
8.7 Summary

8.1 INTRODUCTION
Job analysis refers to the process of examining a job to identify its component parts
and circumstances in which it is performed. The critical concern for you as a job
analyst should be to treat jobs as units of organisation. It acts as a tool which provides
the information base for a wide range of organisational and managerial functions. Job
analysis consists of two functions such as Job Description and Job Specification,
which are closely related to each other. Job description is a broad statement of the
purpose, duties and responsibilities of a job and job specification is a broad statement
which specifies about the job holder, i.e., his/her qualification, experience required etc.
The present unit discusses the competency approach to job analysis and the concept of
competency mapping.

8.2 COMPETENCY APPROACH TO JOB ANALYSIS
A skill is a task or activity required for competency on the job. Competency in a skill
requires knowledge, experience, attitude, and feedback. Performance assessment
criteria clearly define the acceptable level of competency for each skill required to
perform the job. The individual’s level of competency in each skill is measured against
a performance standard established by the organization. These competency skills are
grouped according to a major function of the occupation, and are presented in a two-
dimensional chart. Each skill has its own set of “learning outcomes”, which must be
mastered before a competency in the particular skill is acknowledged.

5

Performance Management The competency based job analysis involves the following steps:
and Potential Assessment
a) Identification of major job functions;
b) Identification of skills performed within each of the major job functions;
c) Generation of several drafts to be reviewed by employers and employees and
modified to accurately reflect the skills performed on the job;
d) Development of an occupational analysis chart. The chart is a two-dimensional
spreadsheet chart displaying the major job functions and skills; and
e) Identification of performance standards for each skill using a competency-based
rating scale which describes various levels of performance.

8.3 USES OF COMPETENCY APPROACH IN AN
ORGANISATION
Competency approach is a foundation upon which to build a variety of human
resource development initiatives. This adaptable, flexible, and scalable tool has been
used for the following benefits to the organization:
a) provides a systematic approach to planning training
b) customizes training delivery to the individual or organization
c) evaluates suitability of training programs to promote job competence
d) provides employees with a detailed job description
e) develops job advertisements
f) helps in personnel selection
g) assists in performance appraisals
h) targets training to skills that require development
i) gives credit for prior knowledge and experience
j) focuses on performance improvement
k) promotes ongoing employee performance development
l) identifies employee readiness for promotion
m) guides career development of employees
n) develops modular training curriculum that can be clustered as needed
o) develops learning programmes

8.4 BENEFITS OF THE COMPETENCY APPROACH
There are different approaches to competency analysis.While some competency
studies take months to complete and result in vague statements that have little
relevance to people in the organization but if done well they provide the following
benefits to the organizations:
a) Increased productivity;
b) Improved work performance;
c) Training that is focused on organizational objectives;
d) Employees know up front what is expected of them;
e) Employees are empowered to become partners in their own performance
development; and
6 f) The approach builds trust between employees and managers

One of the strong points of this approach is that it requires interaction between the Competency Mapping
employer and the employee. The job analysis is a catalyst to meaningful discussion of
job performance because the employer and employee have a common understanding of
expectations. This is due to the explicit nature of the competency statements
pertaining to the job. The fact that the employee conducts a self-appraisal of
performance and the employer must confirm this assessment requires a counseling
type of interaction to take place. The growth plan requires input from the employer
and the employee for its development and follow-up.

8.5 COMPETENCY MAPPING
Competency approach to job depends on competency mapping. Competency Mapping
is a process to identify key competencies for an organization and/or a job and
incorporating those competencies throughout the various processes (i.e. job
evaluation, training, recruitment) of the organization. A competency is defined as a
behavior (i.e. communication, leadership) rather than a skill or ability.
The steps involved in competency mapping are presented below:
a) Conduct a job analysis by asking incumbents to complete a position information
questionnaire(PIQ). This can be provided for incumbents to complete, or used as
a basis for conducting one-on-one interviews using the PIQ as a guide. The
primary goal is to gather from incumbents what they feel are the key behaviors
necessary to perform their respective jobs.
b) Using the results of the job analysis, a competency based job description
is developed. It is developed after carefully analyzing the input from
the represented group of incumbents and converting it to standard
competencies.
c) With a competency based job description, mapping the competencies can be
done. The competencies of the respective job description become factors for
assessment on the performance evaluation. Using competencies will help to
perform more objective evaluations based on displayed or not displayed
behaviors.
d) Taking the competency mapping one step further, one can use the results of one’s
evaluation to identify in what competencies individuals need additional
development or training. This will help in focusing on training needs required to
achieve the goals of the position and company and help the employees develop
toward the ultimate success of the organization.

Activity A
Prepare a Position Information Questionnaire for two jobs you are familiar with and
derive the outcome.
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
7

Performance Management
and Potential Assessment 8.6 METHODS OF COMPETENCY MAPPING
It is not easy to identify all the competencies required to fulfill the job requirements.
However, a number of methods and approaches have been developed and successfully
tried out. These methods have helped managers to a large extent, to identify and
reinforce and/or develop these competencies both for the growth of the individual and
the growth of the organization. In the following section, some major approaches of
competency mapping have been presented.

1) Assessment Centre
“Assessment Centre” is a mechanism to identify the potential for growth. It is a
procedure (not location) that uses a variety of techniques to evaluate employees for
manpower purpose and decisions. It was initiated by American Telephone and
Telegraph Company in 1960 for line personnel being considered for promotion to
supervisory positions. An essential feature of the assessment center is the use of
situational test to observe specific job behavior. Since it is with reference to a job,
elements related to the job are simulated through a variety of tests. The assessors
observe the behavior and make independent evaluation of what they have observed,
which results in identifying strengths and weaknesses of the attributes being studied.
It is, however, worth remembering that there is a large body of academic research
which suggests that the assessment centre is probably one of the most valid predictors
of performance in a job and, if correctly structured, is probably one of the fairest and
most objective means of gathering information upon which a selection decision can be
based. From the candidate’s perspective it is important to be natural and to be oneself
when faced with an assessment centre, remembering always that you can only be
assessed on what you have done and what the assessors can observe.
The International Personnel Management Association (IPMA) has identified the
following elements, essential for a process to be considered as assessment center:
a) A job analysis of relevant behavior to determine attributes skills, etc. for
effective job performance and what should be evaluated by assessment center.
b) Techniques used must be validated to assess the dimensions of skills and
abilities.
c) Multiple assessment techniques must be used.
d) Assessment techniques must include job related simulations.
e) Multiple assessors must be used for each assessed.
f) Assessors must be thoroughly trained.
g) Behavioral observations by assessors must be classified into some meaningful
and relevant categories of attributes, skills and abilities, etc.
h) Systematic procedures should be used to record observations.
i) Assessors must prepare a report.
j) All information thus generated must be integrated either by discussion or
application of statistical techniques.
Data thus generated can become extremely useful in identifying employees with
potential for growth. Following are some of the benefits of the assessment center:
a) It helps in identifying early the supervisory/ managerial potential and gives
sufficient lead time for training before the person occupies the new position.
b) It helps in identifying the training and development needs.
c) Assessors who are generally senior managers in the organization find the training
8 for assessor as a relevant experience to know their organization a little better.

d) The assessment center exercise provides an opportunity for the organization to Competency Mapping
review its HRM policies.
Assessment Centre is a complex process and requires investment in time. It should
safeguard itself from misunderstandings and deviations in its implementation. For this,
the following concerns should be ensured:
a) Assessment Centre for diagnosis is often converted as Assessment Centre for
prediction of long range potential.
b) The assessors’ judgment may reflect the perception of reality and not the reality
itself.
c) One is not sure if the benefits outweigh the cost.
Assessment Centre comprises a number of exercises or simulations which have been
designed to replicate the tasks and demands of the job. These exercises or simulations
will have been designed in such a way that candidates can undertake them both singly
and together and they will be observed by assessors while they are doing the exercises.
The main types of exercises are presented below. Most organizations use a
combination of them to assess the strengths, weaknesses and potential of employees.
a) Group Discussions: In these, candidates are brought together as a committee or
project team with one or a number of items to make a recommendation on. Candidates
may be assigned specific roles to play in the group or it may be structured in such a
way that all the candidates have the same basic information. Group discussion allows
them to exchange information and ideas and gives them the experience of working in a
team. In the work place, discussions enable management to draw on the ideas and
expertise of staff, and to acknowledge the staff as valued members of a team.
Some advantages of group discussion are:
l Ideas can be generated.
l Ideas can be shared.
l Ideas can be ‘tried out’.
l Ideas can be responded to by others.
l When the dynamics are right, groups provide a supportive and nurturing
environment for academic and professional endeavour.
l Group discussion skills have many professional applications.
l Working in groups is fun!
A useful strategy for developing an effective group discussion is to identify task and
maintenance roles that members can take up. Following roles, and the dialogue that
might accompany them in a group discussion have been identified.
1) Positive Task Roles: These roles help in reaching the goals more effectively:
l Initiator: Recommends novel ideas about the problem at hand, new ways to
approach the problem, or possible solutions not yet considered.
l Information seeker: Emphasises “getting the facts” by calling for
background information from others.
l Information giver: Provides data for forming decisions, including facts that
derive from expertise.
l Opinion seeker: Asks for more qualitative types of data, such as attitudes,
values, and feelings.
l Opinion giver: Provides opinions, values, and feelings.
l Clarifier: Gives additional information- examples, rephrasing, applications
about points being made by others.
l Summariser: Provides a secretarial function. 9

Performance Management 2) Positive Maintenance Roles : These become particularly important as the
and Potential Assessment discussion develops and opposing points of view begin to emerge:
l Social Supporter: Rewards others through agreement, warmth , and praise.
l Harmonizer: Mediates conflicts among group members.
l Tension Reliever: Informally points out the positive and negative aspects of
the group’s dynamics and calls for change, if necessary.
l Energiser: Stimulates the group to continue working when the discussion
flags.
l Compromiser: Shifts her/his own position on an issue in order to reduce
conflict in the group.
l Gatekeeper: Smoothes communication by setting up procedures and
ensuring equal participation from members.
During an effective group discussion each participant may take up a number of task
and maintenance roles to keep the discussion moving productively.
In addition, there are a number of negative roles which are often taken up in group
discussion. They should be avoided during group discussions. The discussion group
may adopt the ground rule that negative role behaviour will be censured by members
of the group. Described below are some of the negative roles to be avoided:
l Disgruntled non-participant: someone who does not contribute and whose
presence inhibits the participation of other group members.
l Attacker: someone who acts aggressively by expressing disapproval of
other members and their contributions to the discussion.
l Dominator: someone who takes control of the discussion by talking too
much, interrupting other members, or behaving in a patronising way.
l Clown: someone who ‘shows off’, refuses to take the discussion seriously,
or disrupts it with inappropriate humour.
b) In Tray: This type of exercise is normally undertaken by candidates individually.
The materials comprise a bundle of correspondence and the candidate is placed
in the role of somebody, generally, which assumed a new position or replaced
their predecessor at short notice and has been asked to deal with their
accumulated correspondence. Generally the only evidence that the assessors have
to work with is the annotations which the candidates have made on the articles of
mail. It is important when undertaking such an exercise to make sure that the
items are not just dealt with, but are clearly marked on the items any thoughts
that candidates have about them or any other actions that they would wish to
undertake.
c) Interview Simulations/Role Plays: In these exercises candidates meet
individually with a role player or resource person. Their brief is either to gather
information to form a view and make a decision, or alternatively, to engage in
discussion with the resource person to come to a resolution on an aspect or issue
of dispute. Typically, candidates will be allowed 15 -30 minutes to prepare for
such a meeting and will be given a short, general brief on the objective of the
meeting. Although the assessment is made mainly on the conduct of the meeting
itself, consideration are also be given to preparatory notes.
d) Case Studies / Analysis Exercises: In this type of exercise the candidate is
presented with the task of making a decision about a particular business case.
They are provided with a large amount of factual information which is generally
ambiguous and, in some cases, contradictory. Candidates generally work
independently on such an exercise and their recommendation or decision is
1 0 usually to be communicated in the form of a brief written report and/or a

presentation made to the assessors. As with the other exercises it is important Competency Mapping
with this kind of exercise to ensure that their thought processes are clearly
articulated and available for the scrutiny of the assessors. Of paramount
importance, if the brief requires a decision to be made, ensure that a decision is
made and articulated.

2) Critical Incidents Technique
It is difficult to define critical incident except to say that it can contribute to the
growth and decay of a system. Perhaps one way to understand the concept would be to
examine what it does. Despite numerous variations in procedures for gathering and
analyzing critical incidents researchers and practitioners agree the critical incidents
technique can be described as a set of procedures for systematically identifying
behaviours that contribute to success or failure of individuals or organisations in
specific situations. First of all, a list of good and bad on the job behaviour is prepared
for each job. A few judges are asked to rate how good and how bad is good and bad
behaviour, respectively. Based on these ratings a check-list of good and bad behaviour
is prepared.
The next task is to train supervisors in taking notes on critical incidents or outstanding
examples of success or failure of the subordinates in meeting the job requirements.
The incidents are immediately noted down by the supervisor as he observes them. Very
often, the employee concerned is also involved in discussions with his supervisor
before the incidents are recorded, particularly when an unfavourable incident is being
recorded, thus facilitating the employee to come out with his side of the story.
The objective of immediately recording the critical incidents is to improve the
supervisor’s ability as an observer and also to reduce the common tendency to rely on
recall and hence attendant distortions in the incidents. Thus, a balance-sheet for each
employee is generated which can be used at the end of the year to see how well the
employee has performed. Besides being objective a definite advantage of this
technique is that it identifies areas where counseling may be useful.
In real world of task performance, users are perhaps in the best position to recognise
critical incidents caused by usability problems and design flaws in the user interface.
Critical incident identification is arguably the single most important kind of
information associated with task performance in usability -oriented context.
Following are the criteria for a successful use of critical incident technique:
a) Data are centred around real critical incidents that occur during a task
performance.
b) Tasks are performed by real users.
c) Users are located in their normal working environment.
d) Data are captured in normal task situations, not contrived laboratory settings.
e) Users self report their own critical incidents after they have happened.
f) No direct interaction takes place between user and evaluator during the
description of the incident(s).
g) Quality data can be captured at low cost to the user.
Critical Incidents Technique is useful for obtaining in-depth data about a particular
role or set of tasks. It is extremely useful to obtain detailed feedback on a design
option. It involves the following three steps:
Step 1:Gathering facts: The methodology usually employed through an open-ended
questionnaire, gathering retrospective data. The events should have happened fairly
recently: the longer the time period between the events and their gathering, the greater
the danger that the users may reply with imagined stereotypical responses. Interviews 1 1

Performance Management can also be used, but these must be handled with extreme care not to bias the user.
and Potential Assessment There are two kinds of approaches to gather information:
1) Unstructured approach: where the individual is asked to write down two good
things and two bad things that happened when one was carrying out an activity.
2) Moderate structured approach: where the individual is asked to respond to
following questions relating to what happened when he/she was carrying out an
activity.
1) What lead up to the situation?
2) What was done that was especially effective or non- effective?
3) What was the result( outcome)?
Step 2: Content analysis: Second step consists of identifying the contents or themes
represented by the clusters of incidents and conducting “retranslation” exercises
during which the analyst or other respondents sort the incidents into content
dimensions or categories. These steps help to identify incidents that are judged to
represent dimensions of the behaviour being considered. This can be done using a
simple spreadsheet. Every item is entered as a separate incident to start with, and then
each of the incidents is compiled into categories. Category membership is marked as
identical , quite similar and could be similar. This continues until each item is assigned
to a category on at least a “quite similar” basis.Each category is then given a name
and the number of the responses in the category are counted. These are in turn
converted into percentages (of total number of responses) and a report is formulated.
Step 3: Creating feedback: It is important to consider that both positive and negative
feedback be provided. The poor features should be arranged in order of frequency,
using the number of responses per category. Same should be done with the good
features. At this point it is necessary to go back to the software and examine the
circumstances that led up to each category of critical incident. Identify what aspect of
the interface was responsible for the incident. Sometimes one finds that there is not
one, but several aspects of an interaction that lead to a critical incident; it is their
conjunction together that makes it critical and it would be an error to focus on one
salient aspect .
Some of the advantages of critical incident technique are presented below:
a) Some of the human errors that are unconsciously committed can be traced and
rectified by these methods. For example, a case study on pilots obtained detailed
factual information about pilot error experiences in reading and interpreting
aircraft instruments from people not trained in the critical incident technique (i.e.,
eyewitness or the pilot who made the error)
b) Users with no background in software engineering or human computer
interaction, and with the barest minimum of training in critical incident
identification, can identify, report, and rate the severity level of their own critical
incidents. This result is important because successful use of the reported critical
incident method depends on the ability of typical users to recognise and report
critical incidents effectively.
Some of the disadvantages of critical incidents method are presented below:
a) It focuses on critical incidents therefore routine incidents will not be reported. It
is therefore poor as a tool for routine task analysis.
b) Respondents may still reply with stereotypes, not actual events. Using more
structure in the form improves this but not always.
c) Success of the user reported critical incident method depends on the ability of
typical end users to recognise and report critical incidents effectively, but there is
1 2 no reason to believe that all users have this ability naturally.

3) Interview Techniques Competency Mapping

Almost every organisation uses an interview in some shape or form, as part of
competency mapping. Enormous amounts of research have been conducted into
interviews and numerous books have been written on the subject. There are, however,
a few general guidelines, the observation of which should aid the use of an interview
for competency mapping.
The interview consists of interaction between interviewer and applicant. If handled
properly, it can be a powerful technique in achieving accurate information and getting
access to material otherwise unavailable. If the interview is not handled carefully, it
can be a source of bias, restricting or distorting the flow of communication.
Since the interview is one of the most commonly used personal contact methods, great
care has to be taken before, during and after the interview. Following steps are
suggested:
a) Before the actual interviews begins, the critical areas in which questions will be
asked must be identified for judging ability and skills. It is advisable to write
down these critical areas, define them with examples, and form a scale to rate
responses. If there is more than one interviewer, some practice and mock
interviews will help calibrate variations in individual interviewers’ ratings.
b) The second step is to scrutinize the information provided to identify skills,
incidents and experiences in the career of the candidate, which may answer
questions raised around the critical areas. This procedure will make interviews
less removed from reality and the applicant will be more comfortable because the
discussion will focus on his experiences.
c) An interview is a face-to-face situation. The applicant is “on guard” and careful
to present the best face possible. At the same time he is tense, nervous and
possibly frightened. Therefore, during the interview, tact and sensitivity can be
very useful. The interviewer can get a better response if he creates a sense of
ease and informality and hence uncover clues to the interviewee’s motivation,
attitudes, feelings, temperament, etc., which are otherwise difficult to
comprehend.
d) The fundamental step is establishing “rapport”, putting the interviewee at ease;
conveying the impression that the interview is a conversation between two
friends, and not a confrontation of employer and employee. One way to achieve
this is by initially asking questions not directly related to the job, that is, chatting
casually about the weather, journey and so on.
e) Once the interviewee is put at ease the interviewer starts asking questions, or
seeking information related to the job. Here again it is extremely important to
lead up to complex questions gradually. Asking a difficult, complex question in
the beginning can affect subsequent interaction, particularly if the interviewee is
not able to answer the question. Thus it is advisable for the pattern to follow the
simple-to-complex sequence.
f) Showing surprise or disapproval of speech, clothes, or answers to questions can
also inhibit the candidate. The interviewee is over-sensitive to such reactions.
Hence, an effort to try and understand the interviewee’s point of view and
orientation can go a long way in getting to know the applicant.
g) Leading questions should be avoided because they give the impression that the
interviewer is seeking certain kinds of answers. This may create a conflict in the
interviewee, if he has strong views on the subject. Nor should the interviewer
allow the interview to get out of hand. He should be alert and check the
interviewee if he tries to lead the discussion in areas where he feels extremely
competent, if it is likely to stray from relevant areas. 1 3

Performance Management h) The interviewer should be prepared with precise questions, and not take too
and Potential Assessment much time in framing them.
Once this phase is over, the interviewers should discuss the interviewee, identify areas
of agreement and disagreement, and make a tentative decision about the candidate. It
will be helpful if, in addition to rating the applicant, interviewers made short notes on
their impression of candidates’ behavior responses; which can then be discussed later.
If the interview is to continue for many days, an evaluation of the day’s work, content
of questions and general pattern of response should be made for possible mid-course
correction.
In addition, a large number of methods have been developed to measure and map
competencies. Most of them are of recent origin and are designed to identify those
skills, attitudes and knowledge that are suited most for specific jobs. Some of these
techniques are briefly presented below:

Activity B
Assume that you are conducting interview for the post of “Marketing Executive” of a
company. Describe how you will perform this job by considering the guidelines
provided in the above section.
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................

4) Questionnaires
Questionnaires are written lists of questions that users fill out questionnaire and
return. You begin by formulating questions about your product based on the type of
information you want to know. The questionnaire sources below provide more
information on designing effective questions. This technique can be used at any stage
of development, depending on the questions that are asked in the questionnaire. Often,
questionnaires are used after products are shipped to assess customer satisfaction with
the product. Such questionnaires often identify usability issues that should have been
caught in-house before the product was released to the market.

a) Common Metric Questionnaire (CMQ): They examine some of the competencies
to work performance and have five sections: Background, Contacts with People,
Decision Making, Physical and Mechanical Activities, and Work Setting.
The background section asks 41 general questions about work requirements such as
travel, seasonality, and license requirements. The Contacts with People section asks
62 questions targeting level of supervision, degree of internal and external contacts,
and meeting requirements. The 80 Decision Making items in the CMQ focus on
relevant occupational knowledge and skill, language and sensory requirements, and
managerial and business decision making. The Physical and Mechanical Activities
section contains 53 items about physical activities and equipment, machinery, and
tools. Work Setting contains 47 items that focus on environmental conditions and
other job characteristics. The CMQ is a relatively new instrument.

b) Functional Job Analysis: The most recent version of Functional Job Analysis uses
seven scales to describe what workers do in jobs. These are:Things, Data, People,
Worker Instructions, Reasoning, Maths, and Language.
1 4

Each scale has several levels that are anchored with specific behavioral statements and Competency Mapping
illustrative tasks and are used to collect job information.

c) Multipurpose Occupational System Analysis Inventory (MOSAIC): In this
method each job analysis inventory collects data from the office of personnel
management system through a variety of descriptors. Two major descriptors in each
questionnaire are tasks and competencies. Tasks are rated on importance and
competencies are rated on several scales including importance and requirements for
performing the task. This is mostly used for US government jobs.

d) Occupational Analysis Inventory: It contains 617 “work elements.” designed to
yield more specific job information while still capturing work requirements for
virtually all occupations. The major categories of items are five-fold: Information
Received, Mental Activities, Work Behavior, Work Goals, and Work Context.
Respondents rate each job element on one of four rating scales: part-of-job, extent,
applicability, or a special scale designed for the element. Afterwards , the matching is
done between competencies and work requirements.

e) Position Analysis Questionnaire (PAQ): It is a structured job analysis instrument
to measure job characteristics and relate them to human characteristics. It consists of
195 job elements that represent in a comprehensive manner the domain of human
behavior involved in work activities. These items fall into following five categories:
a) Information input (where and how the worker gets information),
b) Mental processes (reasoning and other processes that workers use),
c) Work output (physical activities and tools used on the job),
d) Relationships with other persons, and
e) Job context (the physical and social contexts of work).

f) Work Profiling System(WPS): It is designed to help employers accomplish human
resource functions. The competency approach is designed to yield reports targeted
toward various human resource functions such as individual development planning,
employee selection, and job description. There are three versions of the WPS tied to
types of occupations: managerial, service, and technical occupations. It contains a
structured questionaire which measures ability and personality attributes.

Activity C
Prepare a questionnaire to analyse a particular job with which you are familiar with.
Refer back to the types of questionnaires discussed in the section while structuring
your questions.
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................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................

5) Psychometric Tests

Many organizations use some form of psychometric assessment as a part of their
selection process. For some people this is a prospect about which there is a natural
and understandable wariness of the unknown. 1 5

Performance Management A psychometric test is a standardized objective measure of a sample of behavior. It is
and Potential Assessment standardized because the procedure of administering the test, the environment in which
the test is taken, and the method of calculating individual scores are uniformly
applied. It is objective because a good test measures the individual differences in an
unbiased scientific method without the interference of human factors. Most of these
tests are time bound and have a correct answer. A person’s score is calculated on the
basis of correct answers. Most tests could be classified in two broad categories:
a) Aptitude Tests: They refer to the potentiality that a person has to profit from
training. It predicts how well a person would be able to perform after training and not
what he has done in the past. They are developed to identify individuals with special
inclinations in given abilities. Hence they cover more concrete, clearly defined or
practical abilities like mechanical aptitude, clinical aptitude and artistic aptitude etc.
b) Achievement Tests: These tests measure the level of proficiency that a person has
been able to achieve. They measure what a person has done. Most of these tests
measure such things as language usage, arithmetic computation and reasoning etc.

8.7 SUMMARY
An effective manager is one who is able to assign jobs to the correct personnel, which
requires perfect job analysis. Job analysis is also useful to make decisions relating to
organisational planning and design, recruitment and selection of personnel, their
training, appraisal and development and other managerial functions. For all these to
happen smoothly there is a requirement of competency approach to job analysis.

1) Discuss the concept of “Competency Mapping”.
2) Describe the roles that are necessary in group discussion citing suitable
examples.
3) Write short notes on:
a) Assessment Centre
b) Psychometric Tests
c) Interview Techniques

Flippo, E.B.(1994) Principles of Personnel Management. New Delhi : Tata McGraw
Hill.
Saiyadain, M.S.(2003) Human Resources Management .New Delhi : Tata McGraw
Hill.
Saiyadain, M.S.(2003) Organisational Behaviour .New Delhi : Tata McGraw Hill.
Sanghi, S.(2004) The Handbook of Competency Mapping. New Delhi: Sage
Publications.

1 6

Performance Planning
UNIT 9 PERFORMANCE PLANNING AND and Review

REVIEW
Objectives
l understand the concept of performance appraisal;
l explain the performance appraisal process;
l discuss the benefits of appraisal;
l describe various appraisal methods; and
l understand the problems in appraisal.

Structure
9.1. Introduction
9.2 Concept of Performance Appraisal
9.3 Goals of Performance Appraisal
9.4 Objectives of Performance Appraisal
9.5 The Performance Appraisal Process
9.6 Benefits of Performance Appraisal
9.7 Performance Appraisal Methods
9.8 Performance Counselling
9.9 Problems in Performance Appraisal
9.10 Effective Performance Appraisal
9.11 Summary

9.1 INTRODUCTION
Performance appraisal helps organizations to determine how employees can help to
achieve the goals of organizations. It has two important activities included in it. First
has to do with determining the performance and other with the process of evaluation.
In this unit, concept of performance appraisal and the processes involved in it have
been discussed.

9.2 CONCEPT OF PERFORMANCE APPRAISAL
a) What is Performance?
What does the term performance actually mean? Employees are performing well when
they are productive. Productivity implies both concern for effectiveness and efficiency,
effectiveness refers to goal accomplishment. However it does not speak of the costs
incurred in reaching the goal. That is where efficiency comes in. Efficiency evaluates
the ratio of inputs consumed to outputs achieved. The greater the output for a given
input, the greater the efficiency. It is not desirable to have objective measures of
1 7

Performance Management productivity such as hard data on effectiveness, number of units produced, or percent
and Potential Assessment of crimes solved etc and hard data on efficiency (average cost per unit or ratio of sales
volume to number of calls made etc.).
In addition to productivity as measured in terms of effectiveness and efficiency,
performance also includes personnel data such as measures of accidents, turnover,
absences, and tardiness. That is a good employee is one who not only performs well in
terms of productivity but also minimizes problems for the organisation by being to
work on time, by not missing days, and by minimizing the number of work-related
accidents.
b) What is Appraisal?
Appraisals are judgments of the characteristics, traits and performance of others. On
the basis of these judgments we assess the worth or value of others and identify what
is good or bad. In industry performance appraisal is a systematic evaluation of
employees by supervisors. Employees also wish to know their position in the
organization. Appraisals are essential for making many administrative decisions:
selection, training, promotion, transfer, wage and salary administration etc. Besides
they aid in personnel research.
Performance Appraisal thus is a systematic and objective way of judging the relative
worth of ability of an employee in performing his task. Performance appraisal helps to
identify those who are performing their assigned tasks well and those who are not and
the reasons for such performance.

9.3 GOALS OF PERFORMANCE APPRAISAL
Conducting performance appraisals on employee’s performance should be more than a
simple checklist of Do’s and Don’ts. Performance evaluation should serve as a vital
component, one that is of interest to both the organization and the employee. From the
organizational perspective, sound performance appraisals can ensure that correct work
is being done, work that assists in meeting department goals simply put. Each
employee’s work should support the activities needed to action his or her supervisor’s
performance objectives. This should ultimately continue up the hierarchy, with all
efforts supporting corporate strategic goals. From the employee perspective, properly
operating performance appraisal systems provide a clear communication of work
expectations. Knowing what is expected is a first step in helping one to cope better
with the stress usually associated with a lack of clear direction. Secondly, properly
designed performance appraisals should also serve as a means of assisting an
employee’s personal development.
To make effective performance appraisals a reality, four criteria need to be present.
These are:
a) Employees should be actively involved in the evaluation and development
process.
b) Supervisors need to enter performance appraisals with a constructive and helpful
attitude.
c) Realistic goals must be mutually set.
d) Supervisors must be aware, and have knowledge of the employee’s job and
performance.

1 8

9.4 OBJECTIVES OF PERFORMANCE APPRAISAL and Review

Performance appraisal has a number of specific objectives. These are given below:
a) To review past performance;
b) To assess training needs;
c) To help develop individuals;
d) To audit the skills within an organizations;
e) To set targets for future performance;
f) To identify potential for promotion.
Some employees may believe that performance appraisal is simply used by the
organization to apportion blame and to provide a basis for disciplinary action. They
see it as a stick that management has introduced with which to beat people. Under
such situations a well thought out performance appraisal is doomed to failure. Even if
the more positive objectives are built into the system, problems may still arise because
they may not all be achievable and they may cause conflict. For Example, an appraise
is less likely to be open about any shortcomings in past performance during a process
that affects pay or promotion prospects, or which might be perceived as leading to
disciplinary action. It is therefore important that performance appraisal should have
specific objective. Not only should the objectives be clear but also they should form
part of the organization’s whole strategy. Thus incorporating objectives into the
appraisal system may highlight areas for improvement, new directions and
opportunities.

9.5 THE PERFORMANCE APPRAISAL PROCESS
Following steps are involved in appraisal process:
1) The appraisal process begins with the establishment of performance standards.
These should have evolved out of job analysis and the job description. These
performance standards should also be clear and objective enough to be
understood and measured. Too often, these standards are articulated in some
such phrase as “a full day’s work” or “a good job.” Vague phrases tell us
nothing. The expectations a manager has in term of work performance by the
subordinates must be clear enough in their minds so that the managers would be
able to at some later date, to communicate these expectations to their
subordinates and appraise their performance against these previously established
standards.
2) Once performance standards are established, it is necessary to communicate
these expectations. It should not be part of the employees’ job to guess what is
expected of them. Unfortunately, too many jobs have vague performance
standards. The problem is compounded when these standards are not
communicated to the employees. It is important to note that communication is a
two-way street. Mere transference of information from the manager to the
subordinate regarding expectations is not communication. Communication only
takes place when the transference of information has taken place and has been
received and understood by subordinate. Therefore feedback is necessary. Hence
the information communicated by the manager has been received and understood
in the way it was intended.
3) The Third step in a appraisal process is measurement of performance. To
determine what actual performance is, it is necessary to acquire information
about it. We should be concerned with how we measure and what we measure.
1 9

Performance Management Four common sources of information are frequently used by mangers to measure
and Potential Assessment actual performance: personal observation, statistical reports, oral reports, and
written reports. Each has its strengths and weaknesses; however, a combination
of them increases both the number of input sources and the probability of
receiving reliable information.
What we measure is probably more critical to the evaluation process than how
we measure. The selection of the wrong criteria can result in serious
dysfunctional consequences. What we measure determines, to a great extent,
what people in a organization will attempt to excel at. The criteria we choose to
measure must represent performance as stated in the first two steps of the
appraisal process.
4) The fourth step in the appraisal process is the comparison of actual performance
with standards. The attempt in this step is to note deviations between standard
performance and actual performance. One of the most challenging tasks facing
managers is to present an accurate appraisal to the subordinate and then have the
subordinate accept the appraisal in a constructive manner. The impression that
subordinates receive about their assessment has a strong impact on their self-
esteem and, very important, on their subsequent performance. Of course,
conveying good news is considerably less difficult than conveying the bad news
that performance has been below expectations. Thus, the discussion of the
appraisal can have negative as well as positive motivational consequences.
5) The final step in the appraisal is the initiation of corrective action when
necessary. Corrective action can be of two types; one is immediate and deals
predominantly with symptoms. The other is basic and delves into causes.
Immediate corrective action is often described as “putting out fires”, where as
basic corrective action gets to the source of deviation and seeks to adjust the
differences permanently. Immediate action corrects something right now and gets
things back on track. Basic action asks how and why performance deviated. In
some instances, managers may rationalize that they do not have the time to take
basic corrective action and therefore must be content to “perpetually put out
fires.” Figure 9.1 shows the performance process in summary.

Establish
Performance
s

Standards

s

Initiate Communicate
Corrective Performance
Action, if expectations
necessary
s

Comparison of s

Actual Measurement
Performance in
s

of Actual
the Performance Performance
standards

Figure 9.1: The Performance Appraisal Process

2 0

9.6 BENEFITS OF PERFORMANCE APPRAISAL and Review

The benefits of an effective appraisal scheme can be summed up under three
categories. These are for the organization, for appraiser and for appraisee.
1) For the Organizations: Following benefits would accrue to the organization.
a) Improved performance throughout the organization due to more effective
communication of the organization’s objectives and values, increased sense
of cohesiveness and loyalty and improved relationships between managers
and staff.
b) Improvement in the tasks performed by each member of the staff.
c) Identification of ideas for improvement.
d) Expectations and long-term plans can be developed.
e) Training and development needs can be identified more clearly.
f) A culture of continuous improvement and success can be created and
maintained.
g) People with potential can be identified and career development plans can be
formulated for future staff requirements.
2) For the appraiser: The following benefits would accrue to the appraiser:
a) The opportunity to develop an overview of individual jobs and departments.
b) Identification of ideas for improvements.
c) The opportunity to link team and individual objectives and targets with
departmental and organizational objectives.
d) The opportunity to clarify expectations of the contribution the manager
expects from teams and individuals.
e) The opportunity to re-prioritize targets.
f) A means of forming a more productive relationship with staff based on
mutual trust and understanding.
3) For the appraisee: For the appraisee the following benefits would accrue:
a) Increased motivation.
b) Increased job satisfaction.
c) Increased sense of personal value.

Activity A
Assume you are currently operating an appraisal system in your organisation. How
will you carry out the same following the above sections.
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................................................................................................................................
................................................................................................................................
................................................................................................................................

9.7 PERFORMANCE APPRAISAL METHODS
This section looks at how management can actually establish performance standards
and devise instruments that can be used to measure and appraise an employee’s
performance. A number of methods are now available to assess the performance of the
employees. 2 1

Performance Management 1) Critical Incident Method
Critical incident appraisal focuses the rater’s attention on those critical or key
behaviors that make the difference between doing a job effectively and doing it
ineffectively. What the appraiser does is write down little anecdotes that describe what
the employee did that was especially effective or ineffective. In this approach to
appraisal, specific behaviors are cited, not vaguely defined personality traits. A
behaviorally based appraisal such as this should be more valid than trait-based
appraisals because it is clearly more job related. It is one thing to say that an
employee is “aggressive” or “imaginative or “relaxed,” but that does not tell anything
about how well the job is being done. Critical incidents, with their focus on behaviors,
judge performance rather than personalities. Additionally, a list of critical incidents on
a given employees provides a rich set of examples from which the employee can be
shown which of his or her behaviors are desirable and which ones call for
improvement. This method suffers from following two drawbacks:
a) Supervisors are reluctant to write these reports on a daily or even weekly basis
for all of their subordinates as it is time consuming and burdensome for them
b) Critical incidents do not lend themselves to quantification. Therefore the
comparison and ranking of subordinates is difficult.

2) Checklist
In the checklist, the evaluator uses a bit of behavioral descriptions and checks of those
behaviors that apply to the employee. The evaluator merely goes down the list and
gives “yes” or “no” responses. Once the checklist is complete, it is usually evaluated
by the staff of personnel department, not the rater himself. Therefore the rater does not
actually evaluate the employee’s performance; he/she merely records it. An analyst in
the personnel department then scores the checklist, often weighting the factors in
relationship to their importance. The final evaluation can then be returned to the rating
manager for discussion with the subordinate, or someone from the personnel
department can provide the feedback to the subordinate.

3) Graphic Rating Scale
One of the oldest and most popular methods of appraisal is the graphic rating scale.
They are used to assess factors such as quantity and quality of work, job knowledge,
cooperation, loyalty, dependability, attendance, honesty, integrity, attitudes, and
initiative etc. However, this method is most valid when abstract traits like loyalty or
integrity are avoided unless they can be defined in more specific behavioral terms. The
assessor goes down the list of factors and notes that point along the scale or
continuum that list of factors and notes that point along the scale or continuum that
best describes the employee. There are typically five to ten points on the continuum. In
the design of the graphic scale, the challenge is to ensure that both the factors
evaluated and the scale pints are clearly understood and unambiguous to the rater.
Should ambiguity occur, bias is introduced. Following are some of the advantages of
this method:
a) They are less time-consuming to develop and administer.
b) They permit quantitative analysis.
c) There is greater standardization of items so comparability with other individuals
in diverse job categories is possible.

4) Forced Choice Method
The forced choice appraisal is a special type of checklist, but the rater has to choose
between two or more statements, all of which may be favorable or unfavorable. The
2 2

appraiser’s job is to identify which statement is most (or in some cases least) Performance Planning
descriptive of the individual being evaluated. To reduce bias, the right answers are not and Review
known to the rater. Someone in the personnel department scores the answers based on
the key. This key should be validated so management is in a position to say that
individuals with higher scores are better-performing employees.
The major advantages of the forced choice method are:
a) Since the appraiser does not know the “right” answers, it reduces bias.
b) It looks at over all performance.
c) It is based on the behavior of the employees.

5) Behaviourally Anchored Rating Scales
These scales combine major elements from the critical incident and graphic rating
scale approaches. The appraiser rates the employees based on items along continuum,
but the points are examples of actual behavior on the given job rather than general
descriptions or traits. Behaviorally anchored rating scales specify definite, observable,
and measurable job behavior. Examples of job-related behavior and performance
dimensions are generated by asking participants to give specific illustrations on
effective and ineffective behavior regarding each performance dimension. These
behavioral examples are then retranslated into appropriate performance dimensions.
Those that are sorted into the dimension for which they were generated are retained.
The final group of behavior incidents are then numerically scaled to a level of
performance that each is perceived to represent. The incidents that are retranslated and
have high rater agreement on performance effectiveness are retained for use as
anchors on the performance dimension. The results of the above processes are
behavioral descriptions, such as anticipates, plans, executes, solves immediate
problems, carries out orders, and handles emergency situations.
This method has following advantages:
a) It does tend to reduce rating errors.
b) It assesses behavior over traits.
c) It clarifies to both the employee and rater which behaviors connote good
performance and which connote bad.

6) Group Order Ranking
The group order ranking requires the evaluator to place employees into a particular
classification, such as “top one-fifth” or “second one-fifth.” Evaluators are asked to
rank the employees in the top 5 per cent, the next 5 per cent, the next 15 per cent. So
if a rater has twenty subordinates, only four can be in the top fifth and, of course, four
must also be relegated to the bottom fifth. The advantage of this method is that it
prevent raters from inflating their evaluations so everyone looks good or from
homogenizing the evaluations for everyone is rated near the average outcome that are
usual with the graphic rating scale. It has following disadvantages:
a) It is not good if the number of employee being compared is small. At the
extreme, if the evaluator is looking at only four employees, it is very possible
that they may all be excellent, yet the evaluator may be forced to rank them into
top quarter, second quarter, third quarter, and low quarter!
b) Another disadvantage, which plagues all relative measures, is the “zero-sum
game”: consideration. This means, any change must add up to zero. For example,
if there are twelve employees in a department performing at different levels of
effectiveness, by definition, three are in the top quarter, three in the second
quarter, and so forth. The sixth-best employee, for instance, would be in the
second quartile. Ironically, if two of the workers in the third or fourth quartiles 2 3

Performance Management leave the department and are not replaced, then our sixth best employee now fit
and Potential Assessment into the third quarter.
c) Because comparison are relative, an employee who is mediocre may score high
only because he or she is the “best of the worst” Similarly, an excellent
performer who is matched against “stiff” competition may be evaluated poorly,
when in absolute terms his or her performance is outstanding.

7) Individual Ranking
The individual ranking method requires the evaluator merely to list all the employees
in an order from highest to lowest. Only one can be the “best.” If the evaluator is
required to appraise thirty individuals ranking method carries the same pluses and
minuses as group order ranking.

8) Paired Comparison
The paired comparison method is calculated by taking the total of [n (n-1)]/2
comparisons. A score is obtained for each employee by simply counting the number of
pairs in which the individual is the preferred member. It ranks each individual in
relationship to all others on a one-on-one basis. If ten people are being evaluated, the
first person is compared, with each of the other nine, and the number of items this
person is preferred in any of the nine pairs is tabulated. Each of the remaining nine
persons, in turn, is compared in the same way, and a ranking is evolved by the greatest
number of preferred “victories”. This method ensures that each employee is compared
against every other, but the method can become unwieldy when large numbers of
employees are being compared.

9) Management by Objectives
Management by objectives (MBO) is a process that converts organizational objectives
into individual objectives. It can be thought of as consisting of four steps: goal setting,
action planning, self-control, and periodic reviews:-
a) In goal setting, the organization’s overall objectives are used as guidelines from
which departmental and individual objectives are set. At the individual level, the
manager and subordinate jointly identify those goals that are critical for the
subordinate to achieve in order to fulfill the requirements of the job as
determined in job analysis. These goals are agreed upon and then become the
standards by which the employee’s results will be evaluated.
b) In action planning, the means are determined for achieving the ends established
in goals setting. That is, realistic plans are developed to attain the objectives.
This step includes identifying the activities necessary to accomplish the objective,
establishing the critical relationships between these activities, estimating the time
requirement for each activity, and determining the resources required to complete
each activity.
c) Self-control refers to the systematic monitoring and measuring of performance.
Ideally, by having the individual review his or her own performance. The MBO
philosophy is built on the assumptions that individuals can be responsible, can
exercise self-direction, and do not require external controls and threats of
punishment.
d) Finally, with periodic progress reviews, corrective action is initiated when
behavior deviates from the standards established in the goal-setting phase. Again,
consistent with MBO philosophy, these manager-subordinate reviews are
conducted in a constructive rather than punitive manner. Reviews are not meant
to degrade the individual but to aid in future performance. These reviews should
2 4 take place at least two or three times a year.

Following are the advantages of MBO: Performance Planning
and Review
a) It is result –oriented. It assists the planning and control functions and provides
motivation.
b) Employees know exactly what is expected of them and how they will be
evaluated.
c) Employees have a greater commitment to objectives that they have participated
in developing than to those unilaterally set by their bosses.

10) 360 degree appraisal
The 360 degree feedback process involves collecting perceptions about a person’s
behaviour and the impact of that behaviour from the person’s boss or bosses, direct
reports, colleagues, fellow members of project teams, internal ad external customers,
and suppliers. Other names for 360 degree feedback are multi-rater feedback, multi-
source feedback, full-circle appraisal, and group performance review. 360 degree
feedback is a method and a tool that provides each employee the opportunity to
receive performance feedback from his or her supervisor and four to eight peers,
subordinates and customers. 360 degree feedback allows each individual to understand
how his effectiveness as an employee, co-worker, or staff member is viewed by others.
The most effective processes provide feedback that is based on behaviours that other
employees can see. The feedback provides insight about the skills and behaviours
desired in the organization to accomplish the mission , vision, goals and values. The
feedback is firmly planted in behaviours needed to exceed customer expectations.
People whoe are chosen as raters are usually those that interact routinely with the
person receiving feedback. The purpose of the feedback is to:
a) assist each individual to understand his or her strengths and weaknesses.
b) contribute insights into aspects of his or her work needing professional
development.
Following are some of the major considerations in using 360 degree feedback.
These are basically concerned with how to:
a) select the feedback tool and process;
b) select the raters;
c) use the feedback
d) review the feedback; and
e) manage and integrate the process into a larger performance management system.
Features of 360 degree appraisal
Organizations that are using with the 360 degree component of their performance
management systems identify following positive features of the process. These
features will manifest themselves in well-managed, well-integrated 360 degree
processes.
a) Improved Feedback from more sources: Provides well-rounded feedback from
peers, reporting staff, co-workers, and supervisors. This can be a definite
improvement over feedback from a single individual. 360 feedback can also save
managers’ time in that they can spend less energy providing feedback as more
people participate in the process. Co-worker perception is important and the
process helps people understand how other employees view their work.
b) Team Development: Helps team members learn to work more effectively
together. Team members know more about how other members are performing
than their supervisor. Multirater feedback makes team members more
accountable to each other as they share the knowledge that they will provide 2 5

Performance Management input on each member’s performance. A well-planned process can improve
and Potential Assessment communication and team development.
c) Personal and Organizational Performance Development: 360 degree feedback
is one of the best methods for understanding personal and organizational
developmental needs.
d) Responsibility for Career Development: For many reasons, organizations per se
are no longer responsible for developing the careers of thei employees. Multirater
feedback can provide excellent information to individuals about what they need
to do to enhance their career. Additionally, many employees feel 360 degree
feedback is more accurate, more reflective of their performance, and more
validating than feedback from the supervisor along. This makes the information
more useful for both career and personal development.
e) Reduced Discrimination Risk: When feedback comes from a number of
individuals in various job functions, biases because of varying reasons are
reduced. The judgemental errors of the supervisors are eliminated as the
feedback comes from various sources.
f) Improved Customer Services: Feedback process involves the internal or external
customer. Each person receives valuable feedback about the quality of his
product or services. This feedback should enable the individual to improve the
quality, reliability, promptness, and comprehesiveness of these products and
services to his/her customers.
g) Training Needs Assessment: Multirater feedback provides comprehensive
information about organization training needs and thus helps in mounting
relevant training programmes. Such programmes add value to the contribution
made by the individual employee.
Benefits of 360 degree Appraisal:
Following benefits of 360 degree Appraisal accrue to the individual, team and
organization:
To the individual:
a) This process helps individuals to understand how others perceive them
b) It uncovers blind spots
c) It provides feedback that is essential for learning
d) Individuals can better manage their own performance and careers
e) Quantifiable data on soft skills is made available.
To the team:
a) It increases communication between team members
b) It generates higher levels of trust ad better communication as individuals identify
the causes of breakdowns
c) It creates better team environment as people discover how to treat others and
how they want to be treated
d) It supports teamwork by involving team members in the development process
e) It increased team effectiveness.
To the Organization:
a) It reinforces corporate culture and openness and trust
b) It provides better opportunities for career development for employees
c) Employees get growth and promotional opportunities
d) It improves customer service by having customers contribute to evaluation
2 6
e) It facilitates the conduct of relevant training programmes.

Activity B Performance Planning
and Review
Review the above mentioned methods of Performance Appraisal and evaluate their
advantages and disadvantages in the context of your organisation.
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................

9.8 PERFORMANCE COUNSELLING
The main objective of performance counselling is to help the employee to overcome
his weaknesses and to reinforce his strengths. In this sense it is a developmental
process where the supervisor and the subordinate discuss the past performance with a
view to help the subordinate to improve and become more effective in future.
Appraisal reports serve as spring board for discussion. One of the fallout effects of
this dyadic interaction is the identification of training needs. Counselling provides an
opportunity to the supervisor to give feedback to the subordinate on the performance
and performance related behavior. Feedback can be an effective tool provided:
a) Both negative and positive feedbacks are communicated.
b) It is not just an opinion but is backed by data. In other words it should be
descriptive and not evaluative.
c) It focuses on behavior rather than on the individual.
d) It is timely. Delayed feedback is neither helpful nor effective. On the other hand,
it might be seen as criticism which may further deteriorate the relationship. As
time passes, details are forgotten and recall may be jeopardized by distortions.
Several conditions for effective counseling are identified. The Following are some of
the important ones:
a) A climate of openness and trust is necessary. When people are tense and hostile,
attempts should be made to counsel and help rather than be critical.
b) The counselor should be tactful and helpful rather than critical and fault finding.
c) The subordinate should feel comfortable to participate without any hesitation or
inhibition.
d) The focus should be on the work-related problems and difficulties rather than
personality or individuals likes, dislikes or idiosyncrasies.
e) It should be devoid of all discussions on salary, reward and punishment. Any
discussion on compensation changes the focus from performance improvement to
the relationship between performance and reward.
Since counselling is a difficult activity, the supervisor should be specially trained in
social competence to handle these aspects of his job. The skill required to do well in
these situations is often referred to as the use of non-directive technique. It is a
methodology of generating information and using this information to help employees.
A sample of non-directive technique could be to start the interview by asking “tell me
how you think you are doing”. This provides an environment for the subordinate to
talk about his part of the story first. The essential feature is to provide an employee an
opportunity to talk and share his experience which the supervisor should be able to
listen and then process and provide feedback to him.
2 7

Performance Management Many supervisors are hesitant to initiate performance counseling sessions because the
and Potential Assessment subordinates may raise uneasy questions for which they may not have answers. Or
they may question their judgments and decisions which may lead to argument, debate
and misunderstanding. That is why there is a need to train supervisors in the
techniques of counseling sessions.
One major outcome of performance counseling is identification of the potential of the
employee’s skills and abilities not known and utilized by the organization. Potential
appraisal is different from performance appraisal as the latter limits evaluation to
what the subordinate has done on the job (or his performance) whereas the former on
the other hand, seeks to examine what the subordinate can do?. The distinct advantage
of a thoroughly carried out potential appraisal are given below:
a) The organizations are able to identify individuals who can take higher
responsibilities.
b) It also conveys the message that people are not working in dead-end jobs in the
organization.

Activity C
List out the contexts in which Performance Counselling is carried out for a particular
employee in your organization.
................................................................................................................................
................................................................................................................................
................................................................................................................................
................................................................................................................................

Career Path
One of the important objectives of appraisal, particularly potential appraisal is to help
employees to move upwards in the organization. People do not like to work on dead-
end jobs. Hence, a career ladder with clearly defined steps becomes an integral
component of human resources management. Most HRM practitioners favor
restructuring of a job to provide reasonably long and orderly career growth. Career
path basically refers to opportunities for growth in the organization. Availability of
such opportunities has tremendous motivational value. It also helps in designing salary
structures, identifying training needs and developing second line in command. Career
paths can be of two kinds:
a) Those where designations changes to a higher level position, job remaining more
or less the same. A good example of this is found in teaching institutions, where
an assistant professor may grow to became associate professor and a professor,
but the nature of job (teaching and research) remains the same. Career path in
such situations means a change in status, better salary and benefits and perhaps
less load and better working condition.
b) Those where changes in position bring about changes in job along with increased
salary, status and better benefits and working conditions. In many engineering
organizations, an employee may grow in the same line with increased
responsibilities or may move to other projects with different job demands.
One important mechanism to identify the promotability of employees is Assessment
Centre. It is a method which uses a variety of technique to evaluate employees for
manpower requirements in the organization. It uses situational tests including
exercises requiring participants to prepare written reports after analyzing management
problem, make oral presentations, answer mail or memo in in-basket situation and a
2 8

whole lot of situational decision making exercises. Assessors observe the behavior and Performance Planning
make independent reports of their evaluation of the strengths and weaknesses of the and Review
attributes being studied.

9.9 PROBLEMS IN PERFORMANCE APPRAISAL
While it is assumed that performance appraisal process and techniques present an
objective system it would be naïve to assume, however, that all practicing managers
impartially interpret and standardize the criteria upon which their subordinates will be
appraised. In spite of our recognition that a completely error-free performance
appraisal can only be idealized a number of errors that significantly impede objective
evaluation. Some of these errors are discussed below:

1) Leniency Error
Every evaluator has his/her own value system that acts as a standard against which
appraisals are made. Relative to the true or actual performance an individual exhibits,
some evaluators mark high and others low. The former is referred to as positive
leniency error, and the latter as negative leniency error. When evaluators are positively
lenient in their appraisal, an individual’s performance becomes overstated; that is
rated higher than it actually should. Similarly, a negative leniency error understates
performance, giving the individuals as lower appraisal.

2) Halo Effect
The halo effect or error is a tendency to rate high or low on all factors due to the
impression of a high or low rating on some specific factor. For example, if an
employee tends to be conscientious and dependable, the supervisor might become
biased toward that individual to the extent that he will rate him/her high on many
desirable attributes.

3) Similarity Error
When evaluators rate other people in the same ways that the evaluators perceive
themselves they are making a similarity error. Based on the perception that evaluators
have of themselves, they project those perceptions onto others. For example, the
evaluator who perceives him self or herself as aggressive may evaluate others by
looking for aggressiveness. Those who demonstrate this characteristic tend to benefit,
while others are penalized.

4) Low Appraiser Motivation
What are the consequences of the appraisal? If the evaluator knows that a poor
appraisal could significantly hurt the employee’s future particularly opportunities for
promotion or a salary increase the evaluator may be reluctant to give a realistic
appraisal. There is evidence that it is more difficult to obtain accurate appraisals when
important rewards depend on the results.

5) Central Tendency
It is possible that regardless of whom the appraiser evaluates and what traits are used,
the pattern of evaluation remains the same. It is also possible that the evaluator’s
ability to appraise objectively and accurately has been impeded by a failure to use the
extremes of the scale, that is, central tendency. Central tendency is the reluctance to
make extreme ratings (in either directions); the inability to distinguish between and
among ratees; a form of range restriction.
2 9

Performance Management 6) Recency vs. Primacy Effect
Recency refers to the proximity or closeness to appraisal period. Generally an
employee takes it easy for the whole year and does little to get the punishment.
However, comes appraisal time, he becomes very active. Suddenly there is an aura of
efficiency, files move faster, tasks are taken seriously and the bosses are constantly
appraised of the progress and problems. All this creates an illusion of high efficiency
and plays a significant role in the appraisal decisions. The supervisor gets railroaded
into believing that the employee is alert and hence, rates him high. In reality though it
refers only to his two to three month’s performance.
The opposite of recency is primacy effect. Here the initial impression influences the
decision on year end appraisal irrespective of whether the employee has been able to
keep up the initial impression or not. First impression is the last impression is perhaps
the most befitting description of this error.

9.10 EFFECTIVE PERFORMANCE APPRAISAL
The issues raised above essentially focus on the problems of reliability and validity of
performance appraisal. In other words, how do we know whether what is appraised is
what was supposed to be appraised. As long as appraisal format and procedure
continues to involve subjective judgment, this question cannot be fully answered and
perhaps, will not be answered completely because no matter how objective a system is
designed it will continue to be subjective. Perhaps, the following steps can help
improve the system.
a) The supervisors should be told that performance appraisal is an integral part of
their job duties and that they themselves would be evaluated on how seriously
they have taken this exercise.
b) To help them do this task well, they should be provided systematic training on
writing performance reports and handling performance interviews.
c) Conduct job evaluation studies and prepare job descriptions/roles and develop
separate forms for various positions in the organization.
d) Design the system as simple as possible so that it is neither difficult to
understand nor impossible to practice
e) Generally after the appraisal interview the employee is left alone to improve his
performance on the dimensions. The supervisor should monitor now and then
whether the improvement in performance in the areas found weak is taking place
or not and, if not, help the employee to achieve the required improvement.
f) Finally, reviewing, the appraisal systems every now and then help updating it,
and making suitable evolutionary changes in it. This is the most important factor
in making performance appraisal effective. As time passes changes in technology
and work environment necessitate changes in tasks, abilities and skills to perform
these tasks. If changes in the format are not incorporated the reports may not
generate the kind of date needed to satisfy appraisal objectives.
In addition, following can also help in improving the effectiveness of an appraisal:

a) Behaviorally Based Measures
The evidence strongly favors behaviorally based measures over those developed
around traits. Many traits often considered to be related to good performance may, in
fact have little or no performance relationship. Traits like loyalty, initiative, courage,
reliability, and self-expression are intuitively appealing as desirable characteristics in
employees. But the relevant question is, Are individuals who are evaluated as high on
3 0

those traits higher performers than those who rate low? Traits like loyalty and Performance Planning
initiative may be prized by managers, but there is no evidence to support that certain and Review
traits will be adequate synonyms for performance in large cross-section of jobs.
Behaviorally derived measures can deal with this objection. Because they deal with
specific examples of performance-both good and bad, they avoid the problem of using
inappropriate substitutes.

b) Ongoing Feedback
Employees like to know how they are doing. The annual review, where the manager
shares the subordinates evaluations with them, can become a problem. In some cases,
it is a problem merely because managers put off such reviews. This is particularly
likely if the appraisal is negative. The solution lies in having the manager share with
the subordinate both expectations and disappointments on a day-today basis. By
providing the employee with frequent opportunities to discuss performance before any
reward or punishment consequences occur, there will be no surprises at the time of the
annual formal review. In fact, where ongoing feedback has been provided, the formal
sitting down step should not be particularly traumatic for either party.

c) Multiple Raters
As the number of raters increase, the probability of attaining more accurate
information increases. If rater error tends to follow a normal curve, an increase in the
number of raters will tend to find the majority congregating about the middle. If a
person has had ten supervisors, nine having rated him or her excellent and one poor,
we can discount the value of the one poor evaluation.

d) Peer Evaluations
Periodically managers find it difficult to evaluate their subordinates’ performance
because they are not working with them every day. Unfortunately, unless they have
this information, they may not be making an accurate assessment. One of the easiest
means is through peer evaluations. Peer evaluations are conducted by employees’ co-
workers, people explicitly familiar with the jobs involved mainly because they too are
doing the same thing, they are the ones most aware of co-workers’ day to-day work
behavior and should be given the opportunity to provide the management with some
feedback.
The main advantages to peer evaluation are that (a) there is tendency for co-workers
to offer more constructive insight to each other so that, as a unit, each will improve;
and (b) their recommendations tend to be more specific regarding job behaviors-unless
specificity exists, constructive measures are hard to gain.

9.11 SUMMARY
Performance appraisal is concerned with setting objectives for individuals, monitoring
progress towards these objectives on a regular basis in our atmosphere of trust and
cooperation between the appraiser and the appraisee. Well designed appraisal systems
benefit the organisation, managers and individuals in different ways and need to fulfill
certain key objectives if they are to be successful. Appraisal systems should be
designed to focus employees on both their short and long-term objectives and career
goals. It is also important to be aware of the problems associated with performance
appraisal systems.

3 1

Performance Management
and Potential Assessment 9.12 SELF ASSESSMENT QUESTIONS
1) Explain the Performance Appraisal System. Either suggest improvements to an
existing appraisal system in your organisation or design an appraisal system
which would meet the objectives outlines in this chapter.
2) Describe the 360 degree appraisal with the help of examples.
3) Write short notes of:
a) Management by objectives
b) Behaviourly Anchored Rating Scale
c) Performance Counselling

Dessler, Gary, (2002) Human Resource Management Delhi. Pearson Education, Pvt.
Ltd.
Fisher, Martin, (1996) Performance Appraisals London: Kogon Page.
Robbins, Stephen P., De Cenzo, David. A(1993) Human Resource Management New
Delhi, Prentice Hall of India Pvt. Ltd.
Rao, T.V., (2004) Performance Management and Appraisal Systems HR Tools for
global competitiveness New Delhi, Response Books.
Saiyadain, Mirza S., (2003) Human Resource Management
(3rd Edition) New Delhi Tata McGraw Hill Publishing Company Limited.

3 2

Potential Appraisal,
UNIT 10 POTENTIAL APPRAISAL, Assessment Centres
and Career and
ASSESSMENT CENTRES AND Succession Planning

CAREER AND SUCCESSION
PLANNING
Objectives

After going through this unit, you should be able to :
l explain the concept of potential appraisal and its importance;
l understand what ‘assessment centre’ is and how it functions;
l differentiate between assessment centres and development centres;
l discuss the process of career planning and its importance; and
l define ‘succession planning’ and differentiate it from career planning.

Structure
10.1 Introduction
10.2 Potential Appraisal
10.3 Assessment Centres
10.4 Career Planning
10.5 Succession Planning
10.6 Summary

10.1 INTRODUCTION
Employees aspire to grow and expect this growth to take place at frequent intervals.
Achievement of organisational goal, increased productivity and fulfilment of corporate
objectives can be possible only if the employees are feeling satisfaction and
achievement. To achieve this there is a requirement for a well thought out system of
career and succession planning in an organisation. In this backdrop, this unit deals
with mechanisms of potential appraisals and ways and means employed by
organizations such as assessment centres to provide growth opportunities to employees.

10.2 POTENTIAL APPRAISAL
Many companies, which carry out performance appraisal, also keep records on the
potential of their employees for future promotion opportunities. The task of identifying
potential for promotion cannot be easy for the appraising manager, since competence
of a member of staff to perform well in the current job is not an automatic indicator of
potential for promotion. Very often the first class salesman is promoted to become a
mediocre sales manager, the excellent chief engineer is promoted to become a very
poor engineering director, and the star football player struggles to be a football
manager.
Potential can be defined as ‘a latent but unrealised ability’. There are many people
who have the desire and potential to advance through the job they are in, wanting the 3 3

Performance Management opportunity to operate at a higher level of competence in the same type of work. The
and Potential Assessment potential is the one that the appraiser should be able to identity and develop because of
the knowledge of the job. This requires an in-depth study of the positions which may
become vacant, looking carefully at the specific skills that the new position may
demand and also taking into consideration the more subjective areas like ‘qualities’
required. These may be areas where the employee has not had a real opportunity to
demonstrate the potential ability and there may be areas with which you, as the
appraisers are not familiar. There are few indicators of potential (Box 1) which may
be considered.
Box 1: Indicators of Potential

l A sense of reality: This is the extent to which a person thinks and acts
objectively, resisting purely emotional pressures but pursuing realistic projects
with enthusiasm.
l Imagination: The ability to let the mind range over a wide variety of possible
causes of action, going beyond conventional approaches to situations and not
being confined to ‘This is the way it is always being done!’
l Power of analysis: The capacity to break down, reformulate or transform a
complicated situation into manageable terms.
l Breadth of vision: The ability to examine a problem in the context of a much
broader framework of reference; being able to detect, within a specific
situation, relationships with those aspects which could be affecting the
situation.
l Persuasiveness: The ability to sell ideas to other people and gain a continuing
commitment, particularly when the individual is using personal influence rather
than ‘management authority’.
Source: Adopted from Philip, Tom (1983). Making Performance Appraisal Work,
McGraw Hill Ltd., U.K.
Like the Performance Appraisal, potential appraisal is also done by the employees’
supervisor who has had the opportunity to observe the employee for some time.
Potential appraisal may be done either regularly or as and when required. Generally
last part of appraisal deals with potential appraisal, as this is seen in case of Maruti
Udyog Ltd. (Illustration 1).
Illustration 1. Potential Appraisal at Maruti Udyog Ltd.
Part III of the Performance Appraisal form of Maruti Udyog Ltd. solicits information
to assess the future potential and ability of its L8 and above categories of workers to
assume a position of higher responsibility (L13) in the following format.
1) Group effectiveness (Maintaining and improving morale of group and helping
its identification with organisational objectives; optimal utilisation of available
manpower resources; directing and co-ordinating efforts and effective follow up
action to ensure accomplishment of planned objectives).

Outstanding Very Good Good Satisfactory Unsatisfactory
2) Ability to develop subordinates (Sensitivity to develop subordinate’s mental
skills; ability to provide professional guidance to produce group results)

3 4 Outstanding Very Good Good Satisfactory Unsatisfactory

3) Potential Capability (Overall rating for managerial capability to head a Potential Appraisal,
department based on your assessment related to the above two points). Assessment Centres
and Career and
Succession Planning

Outstanding Very Good Good Satisfactory Unsatisfactory
Source: Adapted from Tripathi, P.C. (2003). Human Resource Development, Sultan
Chand & Sons, New Delhi.
Career Path
One of the important objectives of appraisal, particularly potential appraisal is to help
employees to move upwards in the organization. People do not like to work on dead-
end jobs. Hence, a career ladder with clearly defined steps becomes an integral
component of human resources management. Most HRM practitioners favour
restructuring of a job to provide reasonably long and orderly career growth. Career
path basically refers to opportunities for growth in the organization. Availability of
such opportunities has tremendous motivational value. It also helps in designing salary
structures, identifying training needs and developing second line in command. Career
paths can be of two kinds:
a) Those where designations changes to a higher level position, job remaining more
or less the same. A good example of this is found in teaching institutions, where
an assistant professor may grow to become associate professor and a professor,
but the nature of job (teaching and research) remains the same. Career path in
such situtions means a change in status, better salary and benefits and perhaps
less load and better working conditions.
b) Those where changes in position bring about changes in job along with increased
salary, status and better benefits and working conditions. In many engineering
organisations, an employee may grow in the same line with increased
responsibilities or may move to other projects with different job demands.

10.3 ASSESSMENT CENTRES
Employees are not contended by just having a job. They want growth and individual
development in the organization. An “assessment centre” is a multiple assessment of
several individuals performed simultaneously by a group of trained evaluators using a
variety of group and individual exercises.
Assessment centers are a more elaborate set of performance simulation tests,
specifically designed to evaluate a candidate’s managerial potential. Line executives,
supervisors, and/or trained psychologists evaluate candidates as they go through one
to several days of exercises that simulate real problems that they would confront on
the job. Based on a list of descriptive dimensions that the actual job incumbent has to
meet, activities might include interviews, in-basket problem-solving exercises,
leaderless group discussions, and business decision games. For instance, a candidate
might be required to play the role of a manager who must decide how to respond to ten
memos in his/her in-basket within a two-hour period. Assessment centers have
consistently demonstrated results that predict later job performance in managerial
positions.
The American Telephone and Telegraph Company (AT&T) began experiments with
Assessment Centre approach in the 1950’s as a part of a wide programme of
management development. The AT&T Company designated a particular building
where the Assessments were carried out. This building became known as Assessment
centre and the name has stuck as a way of referring to the method. The method
became established in the industry in the USA during the 1960’s and 1970’s and was
3 5
introduced in UK during this period.

Performance Management This method is now regarded as one of the most accurate and valid assessment
and Potential Assessment procedures and is widely used for selection and development.
According to IPMA (The International Personnel Management Association), an
assessment center consists of a standardized evaluation of behavior based on multiple
inputs. They are used to assess the strengths, weaknesses and potential of employees.
The specific objective is to reinforce strengths, overcome weaknesses and exploit
potential of the employees through training and developmental efforts. Several trained
observers and techniques are used. Judgments about behavior are made, in major part,
from specifically developed assessment simulations. These judgments are pooled in a
meeting among the assessors or by a statistical integration process. In an integration
discussion, comprehensive accounts of behavior, and often ratings of it, are pooled.
The discussion results in evaluations of the performance of the assessees on the
dimensions/ competencies or other variables that the assessment center is designed to
measure. There is a difference between an assessment center and assessment center
methodology. Various features of the assessment center methodology are used in
procedures that do not meet all of the guidelines set forth here, such as when a
psychologist or human resource professional, acting alone, uses a simulation as a part
of the evaluation of an individual. Such personnel assessment procedures are not
covered by these guidelines; each should be judged on its own merits. Procedures that
do not conform to all the guidelines here should not be represented as assessment
centers or imply that they are assessment centers by using the term “assessment
center” as part of the title. The following are the essential elements for a process to be
considered an assessment center:

a) Job Analysis
A job analysis of relevant behaviors must be conducted to determine the dimensions,
competencies, attributes, and job performance indices important to job success in
order to identify what should be evaluated by the assessment center. The type and
extent of the job analysis depend on the purpose of assessment, the complexity of the
job, the adequacy and appropriateness of prior information about the job, and the
similarity of the new job to jobs that have been studied previously. If past job analyses
and research are used to select dimensions and exercises for a new job, evidence of the
comparability or generalizability of the jobs must be provided. If job does not
currently exist, analyses can be done of actual or projected tasks or roles that will
comprise the new job, position, job level, or job family. Target dimensions can also be
identified from an analysis of the vision, values, strategies, or key objectives of the
organization. Competency-modeling procedures may be used to determine the
dimensions/competencies to be assessed by the assessment center, if such procedures
are conducted with the same rigor as traditional job analysis methods. Rigor in this
regard is defined as the involvement of subject matter experts who are knowledgeable
about job requirements, the collection and quantitative evaluation of essential job
elements, and the production of evidence of reliable results. Any job analysis or
competency modeling must result in clearly specified categories of behavior that can
be observed in assessment procedures.
A “competency” may or may not be amenable to behavioral assessment as defined
herein. A competency, as used in various contemporary sources, refers to an
organizational strength, an organizational goal, a valued objective, a construct, or a
grouping of related behaviors or attributes. A competency may be
considered a behavioral dimension for the purposes of assessment in an assessment
center if
i) it can be defined precisely
ii) expressed in terms of behaviors observable on the job or in a job family and in
3 6 simulation exercises.

iii) a competency also must be shown to be related to success in the target job or Potential Appraisal,
position or job family. Assessment Centres
and Career and
Succession Planning
b) Behavioural Classification
Assessment centre requires that Behaviors displayed by participants must be classified
into meaningful and relevant categories such as dimensions, attributes, characteristics,
aptitudes, qualities, skills, abilities, competencies, and knowledge.
c) Assessment Techniques
The techniques used in the assessment center must be designed to provide information
for evaluating the dimensions previously determined by the job analysis. Assessment
center developers should establish a link from behaviors to competencies to exercises/
assessment techniques. This linkage should be documented in a competency-by
exercise/ assessment technique matrix.

d) Multiple Assessments
Multiple assessment techniques must be used. These can include tests, interviews,
questionnaires, sociometric devices, and simulations. The assessment techniques are
developed or chosen to elicit a variety of behaviors and information relevant to the
selected competencies/ dimensions. Self-assessment and 360 degree assessment data
may be gathered as assessment information. The assessment techniques will be pre-
tested to ensure that the techniques provide reliable, objective and relevant behavioral
information. Pre-testing might entail trial administration with participants similar to
assessment center candidates, thorough review by subject matter experts as to the
accuracy and representativeness of behavioral sampling and/or evidence from the use
of these techniques for similar jobs in similar organizations.

e) Simulations
The assessment techniques must include a sufficient number of job related simulations
to allow opportunities to observe the candidate’s behavior related to each competency/
dimension being assessed. At least one—and usually several—job related simulations
must be included in each assessment center. A simulation is an exercise or technique
designed to elicit behaviors related to dimensions of performance on the job requiring
the participants to respond behaviorally to situational stimuli. Examples of
simulations include, but are not limited to, group exercises, in-basket exercises,
interaction (interview) simulations, presentations, and fact-finding exercises. Stimuli
may also be presented through video based or virtual simulations delivered via
computer, video, the Internet, or an intranet. Assessment center designers also should
be careful to design exercises that reliably elicit a large number of competency-related
behaviors. In turn, this should provide assessors with sufficient opportunities to
observe competency-related behavior.
f) Assessors
Multiple assessors must be used to observe and evaluate each assessee. When
selecting a group of assessors, consider characteristics such as diversity of age, sex,
organizational level, and functional work area. Computer technology may be used to
assess in those situations in which it can be shown that a computer program evaluates
behaviors at least as well as a human assessor. The ratio of assessees to assessors is a
function of several variables, including the type of exercises used, the dimensions to
be evaluated, the roles of the assessors, the type of integration carried out, the amount
of assessor training, the experience of the assessors, and the purpose of the assessment
center. A typical ratio of assessees to assessors is two to one. A participant’s current
supervisor should not be involved in the assessment of a direct subordinate when the
resulting data will be used for selection or promotional purposes. 3 7

Performance Management g) Assessor Training
Assessors must receive thorough training and demonstrate performance that meets
requirements prior to participating in an assessment center. The training should focus
on processing of information, drawing conclusions, interview techniques and
understanding behaviour.

h) Recording Behaviour
A systematic procedure must be used by assessors to record specific behavioral
observations accurately at the time of observation. This procedure might include
techniques such as handwritten notes, behavioral observation scales, or behavioral
checklists. Audio and video recordings of behavior may be made and analyzed at a
later date.

i) Reports
Assessors must prepare a report of the observations made during each exercise before
the integration discussion. It is suggested that assessors must prepare the report
immediately after the assessment is over otherwise they are likely to forget the details.
Not only this, these reports must be independently made.

j) Data Integration
The integration of behaviors must be based on a pooling of information from
assessors or through a statistical integration process validated in accordance with
professionally accepted standards. During the integration discussion of each
dimension, assessors should report information derived from the assessment
techniques but should not report information irrelevant to the purpose of the
assessment process. The integration of information may be accomplished by
consensus or by some other method of arriving at a joint decision. Methods of
combining assessors’ evaluations of information must be supported by the reliability
of the assessors’ discussions. Computer technology may also be used to support the
data integration process provided the conditions of this section are met.

Uses of Assessment Centres
Data generated during the process of Assessment can become extremely useful in
identifying employee potential for growth. This data can be used for:

a) Recruitment and Promotion: Where particular positions which need to be
filled exist, both internal and external can be assessed for suitability to those
specific posts.

b) Early Identification of Personnel: The underlying rationale here is the need for
the organization to optimise talent as soon as possible. High potential people also need
to be motivated so that they remain with the organization.

c) Diagnosis of Training and Development Needs: It offers a chance to establish
individual training and development needs while providing candidates with a greater
appreciation of their needs.
d) Organizational Planning: Assessment centers can be used to identify area where
widespread skill deficiencies exist within organizations, so that training can be
developed in these areas. Results can also be integrated with human resource planning
data to provide additional information concerning number of people with particular
skills needed to meet future needs.

3 8

Assessment Centres and Development Centres Potential Appraisal,
Assessment Centres
Traditionally an assessment centre consisted of a suite of exercises designed to assess and Career and
a set of personal characteristics. It was seen as a rather formal process where the Succession Planning
individuals being assessed had the results fed back to them in the context of a simple
yes/no selection decision. However, recently we have seen a definite shift in thinking
away from this traditional view of an assessment centre to one which stresses the
developmental aspect of assessment. A consequence of this is that today it is very rare
to come across an assessment centre which does not have at least some developmental
aspect to it. Increasingly assessment centres are stressing a collaborative approach
which involves the individual actively participating in the process rather than being a
passive recipient of it. In some cases we can even find assessment centres that are so
developmental in their approach that most of the assessment work done is carried out
by the participants themselves and the major function of the centre is to provide the
participants with feedback that is as much developmental as judgmental in nature.
Assessment centres typically involve the participants completing a range of exercises
which simulate the activities carried out in the target job. Various combinations of
these exercises and sometimes other assessment methods like psychometric testing and
interviews are used to assess particular competencies in individuals. The theory behind
this is that if one wishes to predict future job performance then the best way of doing
this is to get the individual to carry out a set of tasks which accurately sample those
required in the job. The particular competencies used will depend upon the target job
but one should also learn such competencies such as relating to people; resistance to
stress; planning and organising; motivation; adaptability and flexibility; problem
solving; leadership; communication; decision making and initiative. The fact that a set
of exercises is used demonstrates one crucial characteristic of an assessment centre,
namely; that it is behaviour that is being observed and measured. This represents a
significant departure from many traditional selection approaches which rely on the
observer or selector attempting to infer personal characteristics from behaviour based
upon subjective judgment and usually precious little evidence. This approach is
rendered unfair and inaccurate by the subjective whims and biases of the selector and
in many cases produces a selection decision based on a freewheeling social interaction
after which a decision was made as whether the individual’s ‘face fit’ with the
organisation.

Differences between Assessment and Development Centres
The type of centre can vary between the traditional assessment centre used purely for
selection to the more modern development centre which involves self-assessment and
whose primary purpose is development. One might ask the question ‘Why group
assessment and development centres together if they have different purposes?’ The
answer to that question is threefold.
a) they both involve assessment and it is only the end use of the information
obtained which is different i.e. one for selection and one for development.
b) it is impossible to draw a line between assessment and development centres
because all centres, be they for assessment or development naturally lie
somewhere on a continuum somewhere between the two extremes.
c) Most assessment centres involve at least some development and most
development centres involve at least some assessment. This means that it is very
rare to find a centre devoted to pure assessment or pure development. It is easier
to think about assessment centres as being equally to do with selection and
development because a degree of assessment goes on in both.
d) Development Centres grew out of a liberalization of thinking about assessment
centres. While assessment centres were once used purely for selection and have 3 9

Performance Management evolved to have a more developmental flavour, the language used to describe
and Potential Assessment them has not. Another problem with using the assessment - development
dichotomy is that at the very least it causes us to infer that little or no assessment
goes in development centres. While one hears centres being called assessment or
development centres assessment goes on in both and to that extent they are both
assessment centres. The end result of this is that it is not possible to talk about
assessment or development centres in any but the most general terms. A number
of differences between assessment and development centres exist are presented
below:
a) Assessment centres have a pass/fail criteria while Development centres do
not have a pass/fail criteria
b) Assessment centres are geared towards filing a job vacancy while
Development centres are geared towards developing the individual
c) Assessment Centres address an immediate organisational need while
Development Centres address a longer term need
d) Assessment Centres have fewer assessors and more participants while
Development Centres have a 1:1 ratio of assessor to participant
e) Assessment Centres involve line managers as assessors while Development
Centres do not have line managers as assessors
f) Assessment Centres have less emphasis placed on self-assessment while
Development Centres have a greater emphasis placed on self-assessment
g) Assessment Centres focus on what the candidate can do now while
Development Centres focus on potential
h) Assessment Centres are geared to meet the needs of the organisation while
Development Centres are geared to meet needs of the individual as well as
the organization.
i) Assessment Centres assign the role of judge to assessors while
Development Centres assign the role of facilitator to assessors.
j) Assessment Centres place emphasis on selection with little or no
developmental while Development Centres place emphasis on
developmental feedback and follow up with little or no selection function.
k) Assessment Centres feedback and follow up while Development Centres
give feedback immediately.
l) Assessment Centres give feedback at a later date while Development
Centres involve the individual having control over the information
obtained.
m) Assessment Centres have very little pre-centre briefing while Development
Centres have a substantial pre-centre briefing.
n) Assessment Centres tend to be used with external candidates while
Development Centres tend to be used with internal candidates.

10.4 CAREER PLANNING
Career is viewed as a sequence of position occupied by a person during the course of
his lifetime. Career may also be viewed as amalgam of changes in value, attitude and
motivation that occur, as a person grows older. The implicit assumption is that an
invididual can make a different in his destiny over time and can adjust in ways that
would help him to enhance and optimize the potential for his own career development.
Career planning is important because it would help the individual to explore, choose
and strive to derive satisfaction with one’s career object.
4 0

The process by which individuals plan their life’s work is referred to as career Potential Appraisal,
planning. Through career planning, a person evaluates his or her own abilities and Assessment Centres
and Career and
interests, considers alternative career opportunities, establishes career goals, and plans Succession Planning
practical developmental activities.
Career planning seeks to achieve the following objectives:
a) It attracts and retains the right persons in the organisation
b) It maps out careers of employees suitable to their ability, and their willingness to
be trained and developed for higher positions
c) It ensures better use of human resources through more satisfied and productive
employees
d) It ensures more stable workforce by reducing labour turnover and absenteeism
e) It utilizes the managerial talent available at all levels within the organisation
f) It improves employee morale and motivation by matching skills to job
requirements and by providing job opportunities for promotion
g) It ensures that promising persons get experience that will equip them to reach
responsibility for which they are capable
h) It provides guidance and encouragement to employees to fulfill their potential
i) It helps in achieving higher productivity and organizational development
The essence of a progressive career development programme is built on providing
support for employees to continually add to their skills, abilities and knowledge. This
support from organisation includes:
a) Clearly communicating the organisation’s goals and future strategies.
b) Creating growth opportunities
c) Offering financial assistance
d) Providing the time for employees to learn.
On the part of employees, they should manage their own careers like entrepreneurs
managing a small business. They should think of themselves as self-employed. They
should freely participate in career planning activities and must try to get as much as
possible out of the opportunities provided. The successful career will be built on
maintaining flexibility and keeping skills and knowledge up to date.
Career anchors
Some recent evidence suggests that six different factors account for the way people
select and prepare for a career. They are called career anchors because they become
the basis for making career choices. They are particularly found to play a significant
role amongst younger generation choosing professions. They are briefly presented
below:
a) Managerial Competence: The career goal of managers is to develop qualities of
interpersonal, analytical, and emotional competence. People using this anchor
want to manage people.
b) Functional Competence: The anchor for technicians is the continuous
development of technical talent. These individuals do not seek managerial
positions.
c) Security: The anchor for security-conscious individuals is to stabilize their
career situations. They often see themselves tied to a particular organization or
geographical location.
d) Creativity: Creative individuals are somewhat entrepreneurial in their attitude.
They want to create or build something that is entirely their own. 4 1

Performance Management e) Autonomy and independence: The career anchor for independent people is a
and Potential Assessment desire to be free from organizational constraints. They value autonomy and want
to be their own boss and work at their own pace. This also includes an
entrepreneurial spirit.
f) Technological competence: There is a natural affinity for technology and a
desire to work with technology whenever possible. These individuals often
readily accept change and therefore are very adaptable.

Career Planning Process
It is obvious from the foregoing analysis that individuals differ a great deal in term of
their career orientation .The career orientation is influenced by the preference for a
particular career anchor, the life cycle stage, individual difference in values, goals,
priorities, and aspiration. Organization also on the other hand differ in term of career
path and opportunities that they can provide given the reality of their internal and
external environments .The career system available in organizational depend on their
growth potential, goals and priorities. The difference between what the employees look
for in their career progression and what career growth opportunities the organization
is able to provide, gives rise to situation of potential conflict. If the conflict is allowed
to persist, the employee will experience dissatisfaction and withdraw from being
actively engaged in the productive pursuit .They might even choose the option of
leaving the organization. In either case, the organization is not able to optimally utilize
the potential contribution of its employee towards the achievement of its goal.
The possibility of conflict between the individual-organization objective calls for
career planning efforts which can help identify areas of conflict and initiate such
action as necessary to resolve the conflict . Career planning thus involves matching of
rewards and incentives offered by the career path and career structure with hope and
aspiration of employees regarding their own concept of progression. A general
approach to career planning would involve the following steps:
a) Analysis of the characteristic of the reward and incentives offered by the
prevailing career system needs to be done and made know to employee .Many
individuals may not be aware of their own career progression path as such
information may be confined to only select group of managers.
b) Analyse the characteristic of the hopes and aspirations of different categories
of employee including the identification of their career anchor must be done
through the objective assignment. Most organization assume the career aspiration
of individual employee which need not be in tune with the reality .The individual
may not have a clear idea of their short and long term career and life goals , and
may not be aware of the aspiration and career anchor .
c) Mechanism for identifying congruence between individual career aspiration
and organizational career system must develop so as to enable the organization to
discuss cases of mismatch or incongruence. On the basis of analysis, it will be
necessary to compare and identify specific area of match and mismatch for
different categories of employee.
d) Alternative strategies for dealing with mismatch will have to be formulated.
Some of the strategies adopted by several organization include the following :
l change in the career system by creating new career path , new incentives,
new rewards, by providing challenge through job redesign opportunities for
lateral movement and the like.
l change in the employees hopes and aspirations by creating new needs, new
goals, new aspiration or by helping the employees to scale down goal and
aspiration that are unrealistic or unattainable for one reason or the other.
4 2

l Seek new basis of integration, compromise or other form of mutual change Potential Appraisal,
on the part of employee and organizational through problem solving, Assessment Centres
and Career and
negotiation or other devices. Succession Planning
l A framework of career planning process aimed at integrating individual and
organizational needs is presented.
e) Reviewing Career Plans a periodic review of career plans is necessary to know
whether the plans are contributing to the effective utilization of human resources
by matching employee objectives to job needs. Review will also indicate to
employee in which direction the organizations is moving, what changes are likely
to take place and what skills are needed to adapt to the changing needs of the
organization.

10.5 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.
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:
l Superannuation: Employees retiring because they reach a certain age.
l Resignation: Employees leaving their current job to join a new job
l Promotion: Employees moving upward in the hierarchy of the organization.
l Diversification: Employees being redeployed to new activities.
l Creation of New Position: Employees getting placed in new positions at the
same level.
Succession can be from within or from outside the organization. Succession by people
from within gives a shared feeling among employee that they can grow as the
organization grows. Therefore organization needs to encourage the growth and
development with its employee. They should look inward to identify potential and
make effort to groom people to higher and varied responsibilities. In some
professionally run large organizations, managers and supervisor in every department
are usually asked to identify three or four best candidate to replace them in their jobs
should the need arise. However, the organization may find it necessary to search for
talent from outside in certain circumstance. For example, when qualified and
competent people are not available internally, when it is planning to launch a major
expansion or diversification programmes requiring new ideas etc.. Complete
dependence on internal source may cause stagnation for the organization. Similarly
complete dependence on outside talent may cause stagnation in the career prospects of
the individual within the organization which may in turn generate a sense of
frustration.
Succession planning provides managers and supervisors a step-by-step methodology
to utilize after workforce planning initiatives have identified the critical required job
needs in their organization. Succession planning is pro-active and future focused, and
enables managers and supervisors to assess, evaluate, and develop a talent pool of
4 3

Performance Management individuals who are willing and able to fill positions when needed. It is a tool to meet
the necessary staffing needs of an organization/department, taking not only quantity of
available candidates into consideration, but also focusing on the quality of the
candidates, through addressing competencies and skill gaps.

10.6 SUMMARY
Continuous self and staff development are essential to continuous performance
improvement. One’s own self-development needs to be related to your personal
strengths and weaknesses and to the career aspirations. This requires planning of
career progression and setting career goals. This can be achieved by identifying
potentialities of employees with the help of potential appraisal and various methods
involved in it viz. assessment centre.

1) Explain the concept of ‘potential appraisal’ with illustrations.
2) What is career planning? Discuss its needs, purpose and objectives.
3) Is assessment centre same with development centre? If not, what are the
differences?
4) Write a comprehensive note on succession planning citing suitable examples.

Aswathappa, K.: “Human Resource and Personnel Management”, (1999) Himalaya
Publishing House, New Delhi.
Davar, Rustom: “The Human Side of Management”, (1994) Progressive Corporation.
Ghosh, P.: Personnel Administration in India, (1990).
Gupta, C.B., “Human Resource Management” (1997), Sultan Chand & Sons, New
Delhi.
Jucius Micheal, J.: “Personnel Management”,(1995) Richard Irwin.
Micheal, V.P.: “Human Resource Management and Human Relations” (1998),
Himalaya Publishing house, New Delhi.
Monappa, Arun and Saiyadain, Mirza S.: “Personnel Management” (1996), Tata
McGraw-Hill, New Delhi.
Saiyadain, Mirza S.: “Human Resource Management”(3rd Ed.),2003, Tata McGraw-
Hill, New Delhi.
Tripathi, P.C.: “Human Resource Development”, 2003, Sultan Chand, New Delhi.
Philip, Tom: “Making Performance Appraisal Work”, 1983, McGraw Hill, U.K.

4 4

HR Measurement
UNIT 11 HR MEASUREMENT AND AUDIT and Audit

Objectives

After completion of this unit, you should be able to:
l understand the concepts of Human Resource (HR) audit, benchmarking, HR
accounting, HR information systems and HR research;
l discuss the benefits and scope of these concepts; and
l describe the processes involved.

Structure
11.1 Introduction
11.2 Human Resource (HR) Audit
11.3 Benchmarking
11.4 Human Resource (HR) Accounting
11.5 Human Resource Information System (HRIS)
11.6 Human Resource (HR) Research
11.7 Summary

11.1 INTRODUCTION
There seems to be a general notion that one cannot really measure what the HR
function does. That notion is, of course, not of true value. HR function like marketing,
legal, or finance-must be evaluated based on it adds to the organization. Even though
defining and measuring HR effectiveness is not as straightforward as with some areas,
it’s contribution to the overall objectives of organisation cannot be denied.
HR managers perform two major functions. These are traditionally being called as
line and staff functions. While the line function refers basically to managing the HR
department, more significant is the staff function (also called advisory role).
HR managers and their performance are subject to audit for these functions.
Other departments, managers, and employees are the main “customers” for HR
services. If these services are lacking, too expensive, or of poor quality, the
organization may suffer in achieving its objectives. HR can position itself as
a partner in an organization, but only by demonstrating real links between what
HR activities contribute to organizational results. To demonstrate to the rest of the
organization that the HR unit is a partner with a positive influence on the bottom line
of the business, HR professionals must be prepared to measure the results of HR
activities. Then the HR unit must communicate that information to the rest of the
organization.
Studies in India and abroad have found relationship between the best HR practices
and reduced turnover and increased employee productivity. Further, those practices
enhanced profitability and market value of the organisations studied. Data to evaluate
performance and its relationship with HR practices comes from several sources, but
five systems are most often used to measure HR effectiveness. These are:
4 5

Performance Management a) HR audit,
b) Benchmarking,
c) HR accounting ,
d) HR information systems, and
e) HR research.

11.2 HUMAN RESOURCE (HR) AUDIT
Though auditing of other function of an organization is universally emphasized ,the
same cannot be said about the personal function . Various studies indicate that a
comprehensive appraisal of the HR function is under taken by only a small
percentage of companies, though many of them do conduct appraisal of certain
aspects of their personnel activities. However now that the role of HR management
has reached a degree of maturity a systematic and comprehensive audit of its function
is called for.
A human resource audit evaluate the HR activities in an organization with the intent
of improving those activities . The audit may include one division or entire company.
It provides feed back about the HR function to operating managers and HR specialist.
It also provides feedback on how well managers are meeting their HR duties. In short
audit is an overall quality control check on HR activities in a division or a company
supports the organization strategy. The concept of HR audit is similar to the financial
audit –a process to evaluate and a take action where necessary. Auditing is an
evaluation of the system in order to enable management to take decision regarding the
efficient running of an enterprise.
In any organization activities of various departments are constantly reviewed to
ascertain if they are moving in the desired direction and to decide what changes should
be made in view of altered environment condition. The CEO will want to know how
the various units are functioning and how far they have been able to meet policies and
guidelines agreed upon. The assistance will depend on the range of services deemed
suitable in a situational context. These generally involve maintenance aspects, long
range plan and also assumption about the future. Firstly this service needs to be
reviewed. Additionally a check is needed to ensure that management objectives are
understood in same manner by all involved. Finally an evaluation will serve the
purpose of identifying the gap between the objectives and results. In addition to the
top management’s need for audit, the HR manager himself will be concerned about
reviewing the activity of his department. The frequency and indicator may differ, yet
the concern are manifestly the same.
Hence auditing which is the part of control function, may be defined as the
examination and evaluation of policies, procedures and practices in all phase of
business to achieve the most effective administration of the organization. Extending
the definition to the field of HR management auditing consist of the analysis and
evaluation of policies, procedure and practices to determine the effectiveness of HR
management in an organization.

Benefits of HR Audit
Several benefits associated with HR audit are listed below. An audit reminds member
of HR department and others its contribution, creating a more professional image of
the department among manager and specialist. The audit helps clarify the
department’s role and leads to greater uniformity, especially in the geographically
scattered and decentralized HR function of large organisations. Perhaps most
important, it finds problems and ensures compliance with a variety of laws and
4 6

strategic plans in an organization. HR Measurement
and Audit
a) Identifies the contribution of HR department to the organization
b) Improves the professional image of the HR department.
c) Encourages greater responsibility and professionalism among member of the HR
department.
d) Clarifies the HR department’s duties and responsibilities.
e) Stimulates uniformity of HR policies and practices.
f) Finds critical HR problems.
g) Ensures timely compliance with legal requirements.
h) Reduces human resource cost through more effective HR procedure.
i) Creates increased acceptance of needed change in the HR department.
j) Requires thorough review of HR department’s information system.
Besides ensuring compliance, the audit can improve the department’s image and
contribution to the company. Operating managers may have more respect for the
department when an audit team seeks their view. If the comments of manager are acted
on, the department will be seen as being more responsive to their needs. And since it is
service department, these actions may improve its contribution to organizational
objectives.

Scope of HR Audit
In order to conduct HR audit, HR manager requires considerable amount of data . To
conduct meaningful HR audit information on following human resource functions is
necessary:

1) Procurement Function
a) In inventory present and future needs for manpower
b) Reliable performance standard
c) Possible change affecting manpower
d) Location and matching of required and available skills
e) Valid measure for testing and selection
f) Cost of requirement and replacement

2) Development Function
a) Valid measure of employee performance
b) Cost benefit calculation on training and development
c) Linkage between individual aspirations and organizational needs.
d) Career and succession planning.

3) Compensation Function
a) Linkage between wages and productivity
b) Impact of money on work motivation of employee
c) Employee cost in term of turnover
d) Effect of inflation and technology on wages label and productivity
e) Value of collective bargaining and fringe benefit programmes to the
organisation.

4) Maintenance Function 4 7
a) Absenteeism, turnover ,accidents, grievance disciplines, man-days lost and

Performance Management other indicator of organizational health
b) Environmental standards for physical and mental health of the employees.
c) Causes and cost of employee separation
d) Incentives for voluntary separation, if necessary.

5) Integration Function
e) Communication and leadership climate in the company
f) Adoption to environmental change
g) Causes of changes in productivity level
h) Impact of change in technology and market.
The persons in charge of auditing should examine the effectiveness of the HR function
by raising the following issues:
a) Identify who is responsible for each activity.
b) Determine the objectives sought by each activity
c) Review the policies and procedures used to achieve those objectives.
d) Sample the records in the HR information system to learn if the policies and
procedures are being followed correctly.
e) Prepare a report commending proper objectives, policies, and procedures.
f) Develop an action plan to correct errors in objectives, policies
and procedures
g) Follow up on the action plan to see if it solved the problems found through the
audit.
Obviously, audits are time-consuming. As a result, small firms use ad hoc
arrangements that often limit the evaluation to selected areas. Very large organisations
have audit teams similar to those used to conduct financial audits. These teams are
especially useful when the department is decentralized into regional or field offices.
Through the use of audits, the organisation maintains consistency in its practices even
though there are several offices in different locations. And the mere existence of
corporate audit team encourages compliance and self audits by the regional offices
between visits.

Audit Reports
The audit report is a comprehensive description of HR activities that includes both
commendations for effective practices and recommendations for improving practices
that are less effective. A recognition of both good and bad practices is more balanced
and encourages wider acceptance of the report. An audit report contains several
sections. One part is for line managers, another is for managers of specific HR
functions, and the final part is for the HR managers. For line managers, the report
summarises their HR objectives, responsibilities and duties. Examples of duties
include interviewing applicants, training employees, evaluating performance,
motivating workers, and satisfying employee needs. The report also identifies people’s
problems. Violations of policies and employee relations laws are highlighted. Poor
management practices are revealed in the report along with the recommendations.
The specialists who handle employment, training, compensation, and other activities
also need feedback. The audit report they receive isolates areas of good and poor
performance within their functions. For example, one audit team observed that many
jobs did not have qualified replacements. This information was given to the manager
4 8

of training and development along with the recommendation for more programs to HR Measurement
develop promising supervisors and managers. The report may also provide other and Audit
feedback such as attitudes of operating managers about the HR specialists’ efforts.
The HR manager’s report contains all the information given to both operating
mangers and staff specialists. In addition, the manager gets feedback about:
a) Attitudes of operating managers and employees about the department’s benefits
and services.
b) A review of the departments’ objectives and plans to achieve them.
c) HR problems and their implications.
d) Recommendations for needed changes and the priority for their implementation.
With the information contained in the audit report, the HR manager can take a broad
view of the function. Instead of solving problems in a random manner, the manager
can focus on those which have the greatest potential for improving the department’s
contribution to the organisation. Perhaps the most important, the audit serves as the
map for future efforts and a reference point for future audits. With knowledge of the
department’s current performance, the manager can make long term plans to upgrade
crucial activities. These plans identify new goals for the department, which serve as
standards for future audit teams.

Audit Process
Evaluation by audit results is usually superficial because the interpretation of such
indicators is generally limited. High absence rates, for example, may result from a
variety of causes. Turnover may be low because unemployment is high. The audit
probe should be much deeper –apprising programmes, policies, philosophy and theory
.Policy on the depth of the audit must determine which of the following level is
desired.
a) Results including both accomplishment and problem regarded as effect of
current management.
b) Programmes including the detailed practices and procedure of which they
are composed.
c) Policies both explicit and implicit.
d) Philosophy of management, its priorities in value, goals and objectives.
e) Theory or the assured relationship and plausible explanation they clarify
and relate philosophies, policies and continuing problems.
The audit process thus consist of identifying indexes, indicators, statistical ratio
and gross number in some cases ,and examining the variation in time frame in
comparison with a similar previous corresponding period . A summary statement is
then prepared and sent to top management for information and action. Subsequent
research and practice have revealed that conventional audit have a limited focus, are
isolated from the totality of the organization and its human resource , and look upon
procedure only, or emphasize apparent results. Substantive issue such as organization
pattern, style of management, appropriate structure and manpower implication or the
centralized Vs decentralized system are not dealt with in depth. To what extent do the
above factors help develop the human resource potential, or assess the impact of
environment change, political and social, on the industrial relation system and
consequently, how effective is the current industrial relation strategy and practice.
Finally, what modifications are envisaged to cope with emerging pattern? These are
the some of the wider issues which must be dealt with as they will have an impact on
effective management of human resources.
One possible approach to start the thinking process in relation to the HR function is to 4 9
ask the following question :-

Performance Management a) What is the philosophy underlying the function?
b) What principles of management are being followed in carrying it out?
c) What policies have been established for this function?
d) What procedures have been established? Are they in line with the company
philosophy, policies and principle?
e) Are the procedure, policies management principle and philosophy of each
function consistent with those of other related functions?
Such an investigative process calls for imagination in piecing to gather data from
company record and discussion with employees, using questionnaires to conduct
surveys, obtaining comparative data from other organisations and finally, correlating
on variable with another to understand the interrelatedness and thus arriving at a
broader and deeper understanding .If the personnel manager is doing the audit he
should adopt a fact –finding, probing and problem-solving approach–the role normally
played by an external consultant to diagnose the state of an organization’s health.
Activity A
Collect few HR Audit Reports of your organisation or in an organisation where HR
Audit is carried out and write down your comments on them regarding their relevance.
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11.3 BENCHMARKING
A term now often used to describe performance assessment is benchmarking which
seeks to asses the competences of an organization against “best in class” wherever that
is to be found. Often this taken to mean only measures of output performance which
can be defined in quantitative term (comparison of financial performance, key
financial ratio and other measure of output such as market share, production
throughput). However there are also more qualitative less tangible feature of
performance which result on quality or satisfaction such as attitude towards
customers. Assessment of these features is more difficult and it can only be done by
direct observation or surveying user .Benchmarking should include quantitative and
qualitative measure of performance and its emphasize should be on continuous quality
improvement. There are two kinds of Benchmarking – Internal Benchmarking and
External Benchmarking.

Internal Benchmarking
Most organizations monitor their own performance in order to identify change in key
business activities over time. This may mean looking at the performance of the
organization as a whole or comparing the performance of difficult individual teams or
business unit with each other. Performance monitoring is continuous process. Those
with an interest in an organization’s business (shareholder, analyst, management, etc.)
will wish to compare result over time in order to reveal trends in business
performance. This is the only way to discern whether performance is in line with
expectations. Management will be interested in far more then overall organizational
performance. Manager will asses the performance of individual activities involved not
just a business unit. Part of this process will involve regular analysis of performance
against target e.g. financial performance budget, sales and production achievement
5 0 against target.

External Benchmarking HR Measurement
and Audit
This involves comparing performance with that of other organizations. Organizations
need to decide:
a) What activities or other dimension of the organization should be compared with
others?
b) Who the other organizations should be?
c) How information on other organizations can be obtained?
In reality external benchmarking can be time consuming and be hampered by the
difficulty of obtaining relevant information .There are also problems of finding
comparable organizations to bench mark against. Nevertheless, most organization will
wish to asses their own performance relatives to industry norm. They could do this
with reference to industry averages or the time performance of best performing
organization. However a danger in relying solely in industry norm analysis is that
industry may itself perform badly. Obviously the scope of cross industry
comparison will be more limited but could relate, for example the employee cost or to
research and development expenditure.
Perhaps a good example of how to conduct benchmarking exercise comes from Xerox
Company. It has following 10 steps which are to be followed according to the
sequence in which they are presented:
1) Identify what is to be benchmarked.
2) Identify comparable companies.
3) Determine data collection methods and collect data.
4) Determine current performance levels.
5) Project future performance levels.
6) Communicate benchmark results and gain acceptance.
7) Establish functional goals.
8) Develop action plans.
9) Implement action plans and monitor progress.
10) Recalibrate benchmarks.
Like general benchmarking, HR benchmarking is extremely important. When
information on HR performance has been gathered, it must be compared to a standard,
which is a model or measure against which something is compared to determine its
performance level. For example, it is meaningless to know that organizational
turnover rate is 75% if the turnover rates at comparable organizations are unknown.
HR benchmarking compares specific measures of performance against data on those
measures in other “best practices” organizations. HR professionals interested in
benchmarking try to locate organizations that do certain activities particularly well
and thus become the “benchmarks.” HR Benchmarking is useful for following
reasons:
a) An organisation can identify how its HR practices compare with the best
practices.
b) It helps organisations learn what type of HR practices work and they can be
successfully implemented.
c) They provide a basis for reviewing existing HR practices and developing new
practices.
d) They also help managers to establish a strategy and set priorities for HR
practices.
5 1

Performance Management Some of the common benchmarked performance measures in HR management are:
a) Total compensation as a percentage of net income before taxes
b) Per cent of management positions filled internally
c) Rupee sales per employee
d) Benefits as a percentage of payroll cost
Managers need to consider several things when benchmarking. Managers must gather
information about internal processes to serve as a comparison for best practices. It is
also important to clearly identify the purpose of benchmarking and the practice to be
benchmarked, and as with most quality approaches, upper-level management needs to
be committed to the project. Both qualitative and quantitative data should be collected
because descriptions of programmmes and how they operate are as valuable as
knowing how best practices contributed to the bottom line.
To ensure the broadest information possible, managers should be careful to gather
data from the companies both within and outside their industry. Benchmarking may
actually limit a company’s performance if the goal is only to learn and copy what
competitors have done and not to consider various options to improve their process. It
is also important not to view HR practices in isolation from each other. For example,
examining recruitment practices also requires consideration on company’s emphasis
on use of the company’s staffing strategy. Benchmarking will not provide “right”
answer. The information collected needs to be considered in terms of the context of the
companies. Finally, benchmarking is one part of an improvement process. As a result,
use of the information gathered from benchmarking needs to be considered in the
broader framework of organisational change.

Activity B
List out the benchmarking activities that are being carried out in your organisation or
an organisation you are familiar with.
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11.4 HUMAN RESOURCE (HR) ACCOUNTING
Human resource is an important asset in the organisation whose value goes on
increasing with its right placement, application and development in the organisation.
Inspite of vast physical resources with latest technology, an organisation may quite
often find itself in financial crisis if it does not have the right persons to manage its
affairs. Thus human resource is a very valuable asset for the organization which aims
to progress in all directions amidst heavy competition.
Though the concept of Human Resource Accounting is very old, organisations have
not made any effort to assign any monetary value to this in their accounting practice
till the recent past. The real efforts for viewing the human resource as an asset was
started by behavioural scientists from 1960 onwards who tried to develop appropriate
methodology and procedure for finding out the cost and value of the people in the
organisation. They attached the failure of conventional accounting practice to value
the human resource of an organisation along with material resources. Hence, human
resources were identified as the value of production capacity of an organisation, and
the value of customer goodwill. There are two major reasons why human resource
5 2 accounting has been receiving so much attention in the recent years.

a) There is genuine need for reliable and complete management of human resources. HR Measurement
and Audit
b) Traditional framework of accounting is in the process to include a much broader
set of measurement than was possible in the past.
c) People are the most important assets of an organisation and yet the value of this
asset does not appear in financial statements. This information does not get
included in management information systems. Conventional accounting of human
resources consists of taking note of all expenses of human capital formation
which does not seem either to be correct or meeting the actual needs. Human
resource accounting, in simple terms, means accounting for people as the
organisational resources. Human resource accounting is the process of
identifying and measuring data about human resources and communicating this
information to the interested parties. It is the measurement of the cost and value
of people to the organisation. It involves measuring costs incurred by private
firms and public sector units to recruit, select, train and develop employees and
judge their economic value to the organisation.

Objectives of HR Accounting
The objective of HRA is not merely the recognition of the value of all resources used
by the organisation, but it also includes the management of human resource which will
ultimately enhance the quantity and quality of goods and services. The main objectives
of HR Accounting system are as follows:
a) To furnish cost value information for making proper and effective management
decisions about acquiring, allocating, developing and maintaining human
resources in order to achieve cost effective organisational objectives.
b) To monitor effectively the use of human resources by the management.
c) To have an analysis of the human assets i.e. whether such assets are conserved,
depleted or appreciated.
d) To aid in the development of management principles. and proper decision making
for the future by classifying financial consequences of various practices.
e) In all, it facilitates valuation of human resources recording the valuation in the
books of account and disclosure of the information in the financial statement.
f) It helps the organisation in decision making in the following areas:
Direct Recruitment vs. promotion, transfer vs. retention, retrenchment vs. retention,
impact on budgetary controls of human relations and organisational behaviour,
decision on reallocation of plants closing down existing units and developing overseas
subsidiaries etc.

Advantages of HR Accounting
Human Resource Planning anticipates not only the required kind and number of
employees but also determines the action plan. The major benefits of HR accounting are:
a) It checks the corporate plan of the organisation. The corporate plan aiming for
expansion, diversification, changes in technological growth etc. has to be worked
out with the availability of human resources for such placements or key
positions. If such manpower is not likely to be available, HR accounting suggests
modification of the entire corporate plan.
b) It offsets uncertainty and change, as it enables the organisation to have the right
person for the right job at the right time and place.
c) It provides scope for advancement and development of employees by effective
training and development.
5 3

Performance Management d) It helps individual employee to aspire for promotion and better benefits.
e) It aims to see that the human involvement in the organisation is not wasted and
brings high returns to the organisation.
f) it helps to take steps to improve employee contribution in the form of increased
productivity.
g) It provides different methods of testing to be used, interview techniques to be
adopted in the selection process based on the level of skill, qualifications and
experience of future human resources.
h) It can foresee the change in value, aptitude and attitude of human resources and
accordingly change the techniques of interpersonal management

Limitations of HR Accounting
Human Resource Accounting is the term used to describe the accounting methods,
system and techniques, which coupled with special knowledge and ability assist HR
management in the valuation of personnel in financial terms. It is based on the
assumption that there is great difference among the employees in their knowledge,
ability and motivation in the same organisation as well as across organisations. There
are some who produce more, understand faster and show efficiency in training
programmes as compared to others. HR accounting facilitates decision making about
the personnel, either to keep or dispense with their services or to provide training.
HR accounting development and application in different industries and organisations
has not fully grown. There are many limitations which make the management reluctant
to introduce HR accounting in their organisations. Some of these limitations are given
below:
a) There is no proper clear-cut and specific procedure or guidelines for finding cost
and value of human resources of an organisation.
b) If the period of existence of human resource is uncertain, valuing them under
uncertainty in future would be unrealistic
c) There is a fear that HR accounting may dehumanise and manipulate employees.
For example an employee with a comparatively low value may feel discouraged
and develop a complex which will affect his competency to work.
d) The much needed empirical evidence is yet to be found to support the hypothesis
that HR accounting as a tool of the management facilitates better and effective
management of human resources.
e) In what form and manner, their value to be included in the financial statement is
the question yet to be classified on which there is no consensus in the accounting
profession.
f) There is a constant fear of the opposition from the trade unions that placing a
value on employees would make them claim rewards and compensation based on
such valuation.
g) As human resources are not capable of being owned, retained and utilized, unlike
the physical assets, there is a problem for the management to treat them as assets
in the strict sense.
h) Inspite of its significance and necessity, tax laws do not recognize human beings
as assets.
i) There is no universally accepted method of human resource valuation.

11.5 HUMAN RESOURCE INFORMATION
5 4
SYSTEM (HRIS)

Improvements in Technology relating to microcomputers and software have also had a HR Measurement
major impact on the use of information for managing human resources. Traditionally and Audit
computers had been used in human resources only for compensation and benefits-for
example, administering payroll. However, new advances in microchips have made it
possible to store large quantities of data on personnel computers and to perform
statistical analyses that were once only possible with large mainframe computers.
A Human Resource Information System (HRIS) is a system used to acquire, store,
manipulate, analyze, retrieve, and distribute information related to the company’s
human resources. From the manager’s perspective, an HRIS can be used to support
strategic decision making, to avoid litigation, to evaluate programs or policies, or to
support daily operating concerns.
A human resource Information system can be as large or as small as is necessary and
may contain one or tow modules or upto twenty or so. Hundreds of HRIS software
packages are being marketed for both mainframe and microcomputers. A great many
decisions need to be made in the course of adopting and implementing an HRIS. The
specific needs of the organization should dictate the type of human resource
Information system chosen. Any project as potentially expensive, complex, and time
consuming as the addition or upgrading of an HRIS requires careful analysis and
planning.
In adopting a HRIS following issues need to be addressed:
a) Careful need assessment
b) What type and size of HRIS should be adopted
c) Whether to develop software or buy and use off the shelf software
d) Should the HRIS be implemented in total or in stages.
A computerized HRIS is an information system that makes use of computer and
monitors control and influences the movement of human being from the time they
indicate their intention to join an organization till they separate from it after joining .
It consists of the following sub-system.
a) Recruitment Information: It includes the placement data bank advertisement
module, general requirement and training requirement data.
b) Personnel Information: It includes employee information such as transfer
monitoring and increment and promotion details.
c) Manpower Planning Information: It seeks to provide information that could
assist human resource mobilization, career planning, succession planning and
input for skill development.
d) Training Information: It provides information for designing course material,
arrange for need base training and cost analysis of training etc.
e) Health Information System: This subsystem provides information for
maintenance of health related activities of the employees.
f) Appraisal Information: It deals with the performance appraisal and merit rating
information which serves as input for promotion, increment and secession and
career planning etc.
g) Payroll System: It consists of information concerning wages, salaries incentives,
allowance, perquisite deduction for provident fund etc. Data on compensation
pattern of competitor is also included in it.
h) Personnel Statistics System: It is a bank of historic and current data used for
various type of analyst.

Uses of HRIS
Human resource information system refers to the system of gathering, classifying,
5 5
processing, recording and dismantling the information required for efficient and

Performance Management effective management of human resource in an organization. Need for such a system
and Potential Assessment arises due to several factor.
a) Organizations that employ a very large number of people, it becomes necessary
to develop employee database for taking personnel issues.
b) In a geographically dispersed company every office requires timely and accurate
information for manpower management. If information is stored in a multiple
location cost and inaccuracy will increase.
c) Modern day compensation package is complex consisting of many allowance and
deductions etc. A centrally available data can become useful for taking timely
decisions.
d) Organizations have to comply with several laws of the land. A computerized
information system would store and retrieve data quickly and correctly enabling
the organization to comply with statutory requirements.
e) With the help of computerization personnel information system, employer record
and file can be integrated and retrieved for cross-referencing and forecasting.
The system should be oriented towards decision making rather then towards
record keeping.
f) Necessary flexibility for adaptation to changes taking place in the environment
can be built into mechanized information system.
In the field of human resource management, information system has been limited to
payroll preparation, job status and work history report of new hires, termination and
insurance payment. Gradually however progressive companies have started
computerized information system in the area of collective bargaining, employee
manual, training, performance appraisal etc. With sophisticated software, computer
based information system can be used in almost all the functions of human resource
management. A sound HRIS can offer the following advantages:
a) Clear definitions of goal.
b) Reduction in the amount and cost of stored human resource data.
c) Availability of timely and accurate information about human assets.
d) Development of performance standard for the human resource division
e) More meaningful career planning and counselling at all levels.
f) Individual development through linkage between performance reward and job
training.
g) High capability to quickly and effectively solve problems.
h) Implementation of training programmes based on knowledge of organizational
needs.
i) Ability to respond to ever changing statutory and other environment
j) Status for the human resource functions due to its capability for strategic
planning with the total organization.

Designing HRIS
The type or range of HRIS depend on the nature and the size of the organization
,preference of top management, need for government regulation and availability of
software package etc. The steps involved in the development of sound HRIS are given
below:
a) Preliminary System Analysis: It involves definition of the problem specification
of the objectives and operational needs, constraint affecting the system, making
feasibility study and submission of the report.
5 6

b) System Design: At this stage the problem is described in details, alternatives to HR Measurement
meet the objectives are described and evaluated. Broad engineering requirement and Audit
of the chosen alternative are specified and its effect on people are estimated.
c) System Engineering: In this step a detail study of engineering component and
their cost effectiveness is made. Recommendation about the system is then made
to the top management.
d) System Testing and Implementation: The total HRIS, Its subsystem and
running of the system are tested and installed.
e) System Monitoring and Evaluation: It involves measuring the performance of
the system. Its continuous evaluation and modification. It’s necessary to solve
properly the human problem in system design and control. For this purpose the
organization should determine the potential contribution the HRIS can make to
the strategic need and competitive posture of the company. It is necessary to
make the people throughout the organization aware of the advantageous of
Human resource Information system.

11.6 HUMAN RESOURCE (HR) RESEARCH
Research is also used to evaluate HR practices and performance. Research is a
systematic and scientific process of collecting information, analyzing the information
and drawing conclusions for decision-making. At times the research may be advanced,
relying on sophisticated designs and statistics. But whether information is rigorous or
not, research seeks to improve the performance. There are two kinds of research –
academic and applied. Academic research seeks answers to contribute to the existing
body of knowledge. Application – oriented research efforts are called applied research.
For evaluating the HR performance applied research is conducted. There are
following five kinds of applied research.
a) Comparative Approach: The research team compares its organisation (or
division) with another organisation (or division) to uncover areas of poor
performance. This approach commonly is used to compare the results of specific
activities or programs. It helps detect areas of needed improvement.
b) Outside Authority Approach: The research team relies on the expertise of a
consultant or published research findings as a standard against which activities
or programs are evaluated. The consultant or research findings may help
diagnose the causes of problems.
c) Statistical Approach: From existing records, the research team generates
statistical standards against which activities and programs are evaluated. With
these mathematical standards, the team may uncover errors while they are still
minor.
d) Compliance Approach: By sampling elements of the human resource
information system, the research team looks for deviations from laws and
company policies or procedures. Through its fact –finding efforts, the team can
determine whether there is compliance with company policies and legal
regulations.
e) MbO Approach: When an MbO approach is applied to the human resources
area, the research team can compare actual results with stated objectives. Areas
of poor performance can be detected and reported.

Research Method
A number of research methods are available that can be chosen to suit the research
5 7

Performance Management objectives. However, most research is conducted by using one or more of the
and Potential Assessment following methods.
a) Interviews: Interview though time consuming provide very valuable information.
It refers to a face-to-face discussion with managers and other employees to get
information on a particular issue. Interview has several advantages.
l It provides an opportunity to verify information
l Information relating to motivation and commitment can best be sought by
interview.
l It provides an opportunity to explain.
l It is a two-way interaction and hence provides one opportunity to get
in-depth information.
Interviews of employees and managers offer research teams a powerful tool for
collecting information about HR activities and identifying areas that need
improvement. Criticisms and comments from interviews can help pinpoint perceptions
and causes that can form the basis for departmental action. Likewise, suggestions by
managers may reveal ways to provide them with better service. When the criticisms
are valid, changes should be made. But when the HR department is correct, it may
have to educate others in the organization by explaining the procedures that are being
researched.
One useful variation of interview is Exit Interview. Such interviews are conducted
when the employees has decided to leave the organizations. At this time the
employees can very openly discuss problems issues and concerns because now he /she
is not afraid of reprimanded by the authorities. Some extremely useful information
can be gathered through exit interviews, which can be very handy in reviewing HR
policies, identifying training needs and examine behavioural problems that are not
easily identifiable.
b) Questionnaires: Since interviews are time –consuming and costly and often are
limited to only a few people, many HR departments use questionnaires to
broaden the scope of their research. Also, questionnaires may lead to more
candid answers than do face-to-face interviews. Besides being less costly
questionnaires provide an opportunity to collect large amount of date in short
period of time as they could be administered to a group. Questionnaires
generally consist of a list of statement / items to which respondent responds by
either saying yes or no or showing varying degrees of agreement/disagreement.
However one major disadvantage of questionnaire is that it assumes that
respondents can read and write in language used in the questionnaire. Hence
they can be given to only literate people.
c) Secondary Source of Data: Both interviews and questionnaires require human
beings to provide information. If the focus of research is to collect historical data
perhaps the best source could be what is called as secondary source. Where data
is available in published documents, government reports, journals and
magazines, house magazines, minutes of the meetings and achieves etc. Such
data can be extremely useful to examine trends in terms of growth or otherwise.
Needless to say secondary source of data can be very handy method to collect
specific information.

Activity C
a) List out which of the above mentioned HR measurement methods are carried out

5 8

in your organisation and discuss their relevance. HR Measurement
and Audit
.........................................................................................................................
.........................................................................................................................
.........................................................................................................................
.........................................................................................................................
b) If none of those methods are being used then given responsibility, which of the
methods you will implement? Substantiate the answer by stating why and how
you will implement.
.........................................................................................................................
.........................................................................................................................
.........................................................................................................................
.........................................................................................................................

11.7 SUMMARY
To sum up, although there is a notion that measurement of HR function is difficult still
there are ways to do it. Realising the importance of HR contribution in productivity
and performance of organisations, few devises/methods are carried out to measure the
HR functions contribution. In this unit, we have discussed five such HR measurement
methods and their applications in organisations.

1) Write a comprehensive note on HR Audit. Process with the help of illustrations.
2) Define ‘Benchmarking’. What are the types of benchmarking process?
3) Discuss the concept of HR Information System and its applicability.
a) HR Research
b) HR Audit Reports
c) Exit Interview

Aswathappa, K., (1999): “Human Resource and Personnel Management”, New
Delhi, Himalaya Publishing House
Diwedi, R.S., (1997): Personnel Management in Indian Enterprise, Delhi, Galgotia
Publishing Co.
Flippo Edwin B., (1984): “Personnel Management” New York, McGraw-Hill,
Gupta, C.B., (1997): “Human Resource Management”, Sultan Chand and Sons, New
Delhi.
Monappa, Arun and Saiyadain, Mirza S., (1996): “Personnel Management”, New
Delhi, Tata McGraw-Hill.

5 9

Human Resource
UNIT 12 HUMAN RESOURCE Development System

DEVELOPMENT SYSTEM
Objectives
After going through this unit, you should be able to :
l understand the concept of Human Resource Development (HRD) system;
l define HRD;
l Appreciate the need for HRD;
l list the various HRD systems;
l describe sub-systems of HRD; and
l discuss the changing boundaries of HRD.

Structure
12.1 Introduction
12.2 The Concept of Human Resource Development
12.3 The Need for HRD
12.4 HRD Functions
12.5 Human Resource Development Systems
12.6 Principles in Designing HRD Systems
12.7 Changing Boundaries of HRD
12.8 Summary

12.1 INTRODUCTION
Development of human resources is essential for any organisation that would like to
be dynamic and growth-oriented. Unlike other resources, human resources have rather
unlimited potential capabilities. The potential can be used only by creating a climate
that can continuously identify, bring to surface, nurture and use the capabilities of
people. Human Resrouce Development (HRD) system aims at creating such a climate.
A number of HRD techniques have been developed in recent years to perform the
above task based on certain principles. This unit provides an understanding of the
concept of HRD system, related mechanisms and the changing boundaries of HRD.

12.2 THE CONCEPT OF HUMAN RESOURCE
DEVELOPMENT
Increasingly, more importance is being given to “people” in organisations. This is
mainly because organisations are realising that human assets are the most important of
all assets. This emphasis can also be partly attributed to the new emerging values of
humanism and humanisation. Moreover, with the increased emphasis on creativity,
and autonomy, which people are increasingly acquiring and enjoying in the society, the
expectations of people are fast changing. People cannot be taken for granted any more. 5

Human Resource In the past, people working in organisations were given attention merely in
Development administering the necessary conditions of work. The traditional concept of personnel
management was based on a very narrow view of human motivation. The basic
assumption underlying that view was that human beings are primarily motivated by
comforts and salary, and necessary attention may be given to rationalise these, so that
people do not get dissatisfied. Most of the attention, therefore, was on administration
of salary and other benefits. It is now being increasingly realised that people working
in organisations are human beings. They have their own needs, motivation and
expectations, and that their contribution to the organisation is much more than that of
any other resource being used.
The concept of Human Resource System (HRS) assumes that human beings are a
great asset to an organisation. They are not merely necessary evils to be reckoned
with; in fact they can contribute a great deal to the achievement of organisational
goals. This positive view of people working in the organisations as an asset with
unlimited potential is the core of the concept of the human resource system.
Another underlying concept of the system is that investment in human beings is
necessary. Investment for increasing the resource is important, and the more an
organisation invests in its human resources, the greater the return from the investment
is likely to be. This realisation of the need for continuous investment, and the
possibility of substantial return, is an important concept of the human resource
system. There is also one more reason why investment in human resource is necessary.
It is also being realised that organisations have an obligation to the society, that they
should also contribute to the development of people, and operate with the new values
of treating people as human beings, as well as contribute to this value of creating
traditions and culture of respecting people as human beings.
Human resource development in the organisation context is a process by which the
employees of an organisation are helped, in a continuous and planned way to:
1) Acquire or sharpen capabilities required to perform various functions associated
with their present or expected future roles;
2) Develop their general capabilities as individuals and discover and exploit their
own inner potentials for their own and/or organisational development purposes;
and
3) Develop an organisational culture in which supervisor-subordinate relationships,
teamwork and collaboration among sub-units are strong and contribute to the
professional well being, motivation and pride of employees.
This definition of HRD is limited to the organisational context. In the context of a
state or nation it would differ.
HRD is a process, not merely a set of mechanisms and techniques. The mechanisms
and techniques such as performance appraisal, counselling, training, and organisation
development interventions are used to initiate, facilitate, and promote this process in a
continuous way. Because the process has no limit, the mechanisms may need to be
examined periodically to see whether they are promoting or hindering the process.
Organisations can facilitate this process of development by planning for it, by
allocating organisational resources for the purpose, and by exemplifying an HRD
philosophy that values human beings and promotes their development.

12.3 THE NEED FOR HRD
HRD is needed by any organisation that wants to be dynamic and growth-oriented or
to succeed in a fast-changing environment. Organisations can become dynamic and
6 grow only through the efforts and competencies of their human resources. Personnel

policies can keep the morale and motivation of employees high, but these efforts are Human Resource
not enough to make the organisation dynamic and take it in new directions. Employee Development System
capabilities must continuously be acquired, sharpened, and used. For this purpose, an
“enabling” organisational culture is essential. When employees use their initiative,
take risks, experiment, innovate, and make things happen, the organisation may be
said to have an “enabling” culture.
Even an organisation that has reached its limit of growth, needs to adapt to the
changing environment. No organisation is immune to the need for processes that help
to acquire and increase its capabilities for stability and renewal.

12.4 HRD FUNCTIONS
The core of the concept of HRS is that of development of human beings, or HRD. The
concept of development should cover not only the individual but also other units in the
organisation. In addition to developing the individual, attention needs to be given to
the development of stronger dyads, i.e., two-person groups of the employee and his
boss. Such dyads are the basic units of working in the organisation. Besides several
groups like committees, task groups, etc. also require attention. Development of such
groups should be from the point of view of increasing collaboration amongst people
working in the organisation, thus making for an effective decision-making. Finally, the
entire department and the entire organisation also should be covered by development.
Their development would involve developing a climate conducive for their
effectiveness, developing self-renewing mechanisms in the organisations so that they
are able to adjust and proact, and developing relevant processes which contribute to
their effectiveness.
Hence, the goals of the HRD systems are to develop:
l The capabilities of each employee as an individual.
l The capabilities of each individual in relation to his or her present role.
l The capabilities of each employee in relation to his or her expected future role(s).
l The dyadic relationship between each employee and his or her supervisor.
l The team spirit and functioning in every organisational unit (department, group,
etc.).
l Collaboration among different units of the organisation.
l The organisation’s overall health and self-renewing capabilities which, in turn,
increase the enabling capabilities of individuals, dyads, teams, and the entire
organisation.
Such a concept of development will focus on the different units available in the
organisation for different purposes. The individual and his role are important units for
some purposes. For others, groups, departments and the entire organisation are more
relevant units. The concept of development should therefore cover all such possible
units.
Development in this sense becomes a massive effort. While training may play the
major role in designing and monitoring development efforts in the organisation, other
parts of the organisation have to share in such an effort. In fact, the person, or the
groups for whom the efforts of development are made, is also a partner in this process
of development. The four partners or agents of development can be identified as: (a)
the person or role, (b) the immediate boss of the person, (c) the human resource
management department, and (d) the organisation. The various foci and the four
agents of development are shown in Exhibit 1.
7

Human Resource Exhibit 1 The Development Dimensions of the Personnel Function
Development
1) Analysing the Role
a) Task analysis
b) Key performance areas
c) Critical attributes
d) Job evaluation
2) Matching the Role and the Person
a) Selection/recruitment
b) Placement
c) Potential appraisal
d) Promotion
e) Career Development, career and succession planning
3) Developing the Persons in the Role
a) Performance appraisal
b) Feedback and counselling
c) Mentoring
d) Career development
e) Training
4) Developing the Role for the Person
a) Job rotation
b) Job enrichment/ redesigning
c) Role effectiveness and efficacy
5) Developing Equitability
a) Management of salary and amenities
b) Management of incentives and rewards
c) Standardising and administering procedures
6) Developing Self-renewing Capability
a) Communication
b) Organisation development
c) Organisational learning
d) Developing culture and climate
7) Coping with Collective Power

1) Analysing the Role
One of the main aspects of HRM is to analyse the role in terms of responsibilities or
key functions/ performance areas of the role, and the competencies required to
perform the role effectively.

2) Matching the Role and the Person
Once the organisation is clear about the dimensions of the roles or the jobs, it tries to
get the best people for these jobs. After people are recruited they are put in different
places. Recruitment and placement are important aspects of HRM. Placement is
useful for giving varied experiences to people being recruited. Another aspect of
matching role and person is reflected in potential appraisal, finding out who has
potential to match the requirement of the job. Unit 10 deals with potential appraisal.
Obviously, the next step is promotion of people by placing them in appropriate roles
for which the organization is searching people. Promotion is only one part of
8 longterm and succession planning.

3. Developing the Persons in the Role Human Resource
Development System
Individuals develop not only through training, but, and in fact more through effective
supervision, by helping them to understand their strengths so that they can leverage
them for better performance. Similarly, they are helped to find out in what they have
to be more effective in their jobs. Performance appraisal is not complete unless the
performance is properly reviewed and feedback is given, and people are helped to
understand their strengths and weaknesses. We are discussing this aspect in Unit 14 in
this block, along with performance coaching or counseling. It is also important to
give opportunity to young and bright persons to deal with their problems; such help is
provided generally by senior persons who are not necessarily related in job with the
person seeking help. This process of mentoring is also discussed in Unit 14 of this
block. One important aspect relating to employee development, but unfortunately not
adequately dealt with, is training. Unit 13, devoted to this important aspect in this
block.

4) Developing the Role for the Person
Very little attention has been given to role, although job rotation is being practiced in
most of the organizations, and some organisations have also tried out job enrichment
based on Herzberg’s concept of motivators. Unit 15 discusses development of roles,
including role effectiveness and role efficacy. Traditionally HR function has given
attention to individual employees and teams have been generally neglected. It is
evident now that most of the work is done by teams, and team effectiveness is
important for all organizations. We have devoted sufficient attention to this aspect in
Unit 15 of the block.

5) Developing Equitability
Satisfaction level of employees depends to a great extent on their perceived justice
being done to them without any discretion, as reflected in practices like management
of compensation, rewards, and various amenities. People have high performance and
develop competencies only if these are rewarded by the organisation. Reward does not
mean financial reward only, many rewards may be non-financial also. Equitability can
also be developed by standardising administrative procedures, so that people do not
have any feelings that decisions are subjective.

6) Developing Self-renewing Capability
An organisation should be concerned not only with its growth, but also with its health.
It needs to diagnose its problems from time-to-time and take steps to develop new
competencies to cope with the various problems and challenges it would be facing.
This can be done through action research that is concerned with development of
competencies through effective teams to diagnose the problems and initiate the process
of collaborative work to deal with such problems. In Organisation Development (OD),
the focus is on developing process competency to increase organisation effectiveness.
OD aims at maintaining profiles of organisational health, monitoring organisational
health, assisting sick departments, helping interested units and departments in
self-renewal, conflict management, creation of strong teams and so on, and
establishing processes that build a climate to promote enabling capabilities in the
organisation. OD in the earlier years, mainly in the 1960s (and partly in the 1970s)
was team/group-based. Most of the OD interventions in organisations started with
deep process work beginning at the top level. OD has now widened considerably,
it is no more confined to managers, it has been attempted with workers also.
Attention has also been given to organisationaI learning, to develop the competence
of an organisation to analyse its experience and learn from it. This has been
discussed in Unit 13. The third aspect of self-renewal is research orientation in
9

Human Resource HRD, which means consciously and continually collecting data in order to understand
Development the various issues, and designing on-going interventions based on such data. For
example, data were collected. and used effectively in L&T on the working of the
appraisal system including counselling. Such data can help to improve implementation
of the appraisal system. HRD related research is important, it helps in analysing data
and information generated by the HRD sub-systems. HRD in L&T has already
established the orientation and several other organisations are in the process of
introducing such “Research-orientation”. For example, data related to HRD are being
systematically analysed in Eicher on a regular basis.
Communication and development of culture, two often neglected aspects, are
discussed in some details below:
Communication: Many organisations have paid attention to communication. Over the
years, some innovative and successful practices have been evolved in a number of
Indian organisations. For example, in BHEL (Bhopal Unit), Management Employees
Communication Meetings (MECOMs) have been effectively used. A MECOM as an
open forum, in which more than 700 persons participate. It has contributed to mutual
sharing of information and concerns and better understanding between management
and employees. It has helped in effective implementation of decisions. Establishing
this system was not easy: a great deal of OD work had to be done prior to and during
the evolution of MECOM.
In Tata Iron and Steel Company (TISCO) the Chairman keeps communication with
his employees by answering every letter that is addressed to him (some 80,000 in a
year) and has an open house at his residence between 7 and 9 every morning where
anyone can walk in and discuss personal or work-related problems. He also holds
dialogues with large groups, sometimes consisting of as many as 2500 persons. A
very systematic attention has been paid to communication in VSAT Industries
(including regular business-related communication with the union) with great benefits
Communication ensures the flow of goal-oriented information and messages between
different individuals and groups. in all directions, to help them perform their roles
more effectively. Communication minimizes distortion of information (studies have
shown that in downward communication the information loss in terms of original
messages is about 40 per cent by the time it reaches GMs. 60 per cent by the time
plant managers receive it. 70 per cent by the time general foremen get it, and the
loss is as high as 80 per cent by the time it reaches the worker). Communication also
minimises hierarchical and psychological distance and maximises collaboration
amongst individuals and teams in an organisation. More specifically, the following are
the objectives of communication in an organisation: information sharing, feedback,
control, influence, problem solving, decision making, facilitating change, and
facilitating group development. There are mainly four directions of organizational
communication:
i) Downward communication: The following types of communications are
suggested along with some mechanisms:
a) Diffusion of routine information: This can be better done through
circulars, bulletin boards and so on.
b) Diffusion of procedural information: This can be done by circulars,
especially prepared notebooks and manuals.
c) Socialisation: As already suggested, socialisation of individuals in the value
system of the company should be done through induction booklets, special
programmes, and meetings. Sharing of information from higher levels with
the employees may also help employees to feel they are a part of the
organisation.
1 0

d) Job-related information: This needs to be done by interpersonal Human Resource
communication between the job holder and his reporting officer. Development System

e) Feedback on individual performance: The most effective way of this
communication is the appraisal review and coaching meetings held on the
basis of performance appraisal results.
(f) Employee development: Employee development is done through dyadic
communication, based on trust between a manager and his employee,
training programmes. and group meetings. A more effective communication
for development is by the model set by senior managers.
ii) Upward communication: Upward communication is as necessary as downward
communication. There are several purposes for such communication. These are
suggested below, along with possible mechanisms of developing them.
a) Management control: Use of management information ensuring regular
flow of information helps in achieving effective management control.
b) Feedback: Feedback from lower levels to higher levels is very useful. Such
feedback can be provided by use of special questionnaires and interviews.
Exit interviews conducted when people are leaving the organization are used
for feedback on important aspects which the people at higher level must
know.
c) Problem solving and involvement: The effective mechanism for solving
person related problems of lower level management by the higher levels are
grievance procedures and periodical meetings called by the higher level
management. Another good method which may help the people at lower
levels in the organisation to participate in problem solving is a suggestion
scheme, which however, needs to be well designed, properly executed, and
periodically reviewed to save it from becoming ritualistic. A small Task
Force may be constituted to prepare a scheme, and monitor it for sometime.
Periodical meetings allowing all employees to express their feelings and give
feedback. to the management, to help them to take follow up action on
problems has been found to be useful in some organisations. VST Industries
have introduced the scheme in a planned way (Vidyasagar , in NHN, 1989:
150).
iii) Horizontal communication: Communication across business groups, regions and
units is very important to develop collaboration and reduce bureaucratisation.
The following tasks can be achieved, with different mechanisms as suggested
below:
a) Experience sharing: Functional group meetings (like those of Finance,
HRD, R&D, EDP people and others) from different business groups, along
with other relevant people from the corporate departments may be helpful.
b) Problem solving: Participation of people from different business groups in
solving common problems can be achieved by setting up a special Task
Force (group to work out details and, in many cases, to implement action
plans) and a Problem Clinic (group to diagnose problems and suggest
alternative solutions, using special techniques of diagnosis).
c) Coordination: Standing committees are meant to make coordination more
effective.
iv) External communication: Communication with external agencies, like current
and potential customers, government agencies. competitors and potential
collaborators, resource providers (banks and financial institutions) is very
important, but often gets little attention. The following purposes can be served by
the suggested mechanisms: 1 1

Human Resource a) Image building: Annual reports, balance sheets, brochures. advertisements
Development and the like are important mechanisms, deserving detailed planning in terms
of form and content. Participation of Company Executives in professional
bodies like Management Associations, Chambers of Commerce Sub-
Committees also help significantly.
b) Credibility building: Balance Sheet and correspondence (prompt,
purposive, and precise) contribute to the credibility of the company.
c) Influencing: An organisation should not shy away from its role of
influencing policies and decisions in the concerned industries and other
forums. Well-prepared dialogue by the top management and participation in
conferences and forums must receive the attention they deserve. One general
weakness of Indian companies is the lack of expertise and seriousness in
influencing external agencies. One of the most important roles of Corporate
Management is to develop an aggressive (in the positive sense) posture and
competence to deal with critical issues. This ability has been amply
demonstrated by many organisations.
Organisational Culture: Culture has remained the most neglected part of HRD, but
has attracted some attention in the last few years. Interest in culture has been aroused
by the examples of Japanese successes. Some organisations in India have adopted
Japanese practices, notable among them being Maruti Udyog and Sundaram Clayton.
Maruti Udyog adopted some practices because of the positive pressure of Suzuki.
These practices are a 7 hours 45 minutes shift, zero-defect production, cost cutting,
and discipline. This helped in the development of a new organisational culture.
Organisational culture can be defined as cumulative ways of thinking and behaving
which the values, attitudes, rituals, and sanctions in an organisation shape.
Operationally, development of culture would involve developing a strong corporate
identity, development of important values, building healthy traditions and developing
consistent management practices. Cultural systems are concerned with development of
appropriate organisational culture. Creating conducing organisational climate.
Improving communication and evolving effective reward systems. It is to be noted that
whatever is rewarded in an organisation gets reinforced. Therefore, a reward system
(including incentives) both for individuals and teams deserves careful attention.
Rewards can facilitate and promote good work but if not designed properly, can do a
great deal of harm to the organisation. Systematic attention has been given to the
reward systems in the construction group of L&T, where a need-based system was
evolved.
Organisational climate is another concept close to culture that has received attention in
recent years. Different approaches have been adopted to create a climate conducive to
work. An instrument for assessing appropriate HRD climate has been developed and
used in many organisations and some instruments to measure ethos and, atmosphere
are available. Development of appropriate culture has attracted a great deal of
academic attention in the past few years. Some companies have paid deliberate
attention to developing an appropriate culture (viz. C-Dot, Modi Xerox, Sundaram
Clayton, Eicher). Some have made attempts to improve their cultures (viz. Procter
and Gamble, Ballarpur Industries Ltd., Indian Farmers’ Fertiliser Cooperative
(IFFCO).
Development of culture takes a long time and involves complex processes. The
following aspects deserve attention in this regard.
a) Strong Corporate Identity: The sense of identity with the organisation develops
when the employees have a sense of belonging, and they feel proud to belong to
the organisation. Identity develops as a result of interaction of the employees
with the organisation. The following action ideas help in developing strong
1 2
corporate identity.

i) Developing an attractive booklet, giving basic information about the Human Resource
company. Indo-Burma Petroleum Company (IBP Co.) and several other Development System
organisations have developed good induction material.
ii) Films on success experiences in organisations, if shown on special
occasions, may help build corporate identity. “Manthan” directed by Shyam
Benegal for NDDB is a good example of such a film. By inviting
suggestions from the key divisions of an organisation, the HRD Department
can prepare a list of such video films to be developed.
iii) Company newsletters giving information about business development and
significant information about the employees are being published by many
organisations.
iv) Mobility of people (corporate field, division-unit, inter-division) has been
used among other things for the development of organisational identity.
b) Developing Important Values: Values related to organisationaI culture, such as
values of excellence and human consideration do not develop through mere
didactic exercises like lectures, talks, or writing, but by demonstrating these
values in action by the key role holders. The following practices have helped the
development of relevant values.
i) Survey feedback of values, in particular, feedback on the gap between
“espoused values” and “values in action” as reflected in the management
practices. Seminars can be held at different levels to deal with the data
generated on these gaps.
ii) Special value-orientation programmes in developing appropriate values, in
which, instead of teaching what values are good, the programme helps
participants to examine the relevance and functionality of certain values and
openly questions and discusses the desirable value system and the one that
they see in action. Such programs on value clarification help people to
internalise values by stating their own values without hesitation, by
examining openly and frankly the desirability of a different value system,
and also by developing specific ideas of practicing such values in the workplace.
iii) Examining the various operating systems in the organisation. As for
example, a content analysis of the budgetary, MIS, appraisal, promotion,
career planning and rewards system can indicate what values they reinforce.
The concerned groups can then examine the data for insight and
development of appropriate action plan(s).
iv) Special OD intervention in developing collaboration and concern for
excellence may help in anchoring appropriate value orientation through such
exercises as team building, achievement and extension motivation
programmes and so on.
c) Building Healthy Traditions and Practices: Traditions in an organisation are
built on the basis of important rituals. Rituals or celebrations associated with the
transition of people from one state to another are important avenues for
identifying a culture. In Indian society for example, about 16 rituals are
associated with transition from one phase of life to another. These rituals do
contribute to the development of social, and family traditions. Attention should
be given to the identification of functional rituals within the organisation. Some
interesting practices have already been found useful in some companies.
i) Induction programme for new entrants help the employees to develop a sense
of belonging. Detailed planning is needed to help them develop pride and joy
in becoming a member of the company that will reinforce the sense of
belonging and identification with the company. Sundaram Clayton’s
“acculturation workshops” for new entrants are very well designed and
1 3
exemplary.

Human Resource ii) Promotions need to be treated as an important event of transition of a person
Development from one stage to another. Instead of only written communication of
promotion, a face-to-face conversation with the concerned chief may be
useful, before it is communicated in writing; the information of promotion is
shared with the concerned employee along with its implications.
iii) Rituals associated with Old age and retirement of people should also receive
due attention from the HRD wing. The Malayala Manorama group has
evolved some rituals associated with an employee’s death and old age. For
example, “senior members” (employees having completed certain years of
service) are taken free on a Bharat darshan trip along with their spouses.
(“senior couples”’).
iv) The exceptional behaviour of an employee in helping the organisation or in
solving different problems and so on, must be recognised. rewarded and
made visible. This may help to develop the tradition of indulging in such
behaviour more frequently. People find reasons to repeat a behaviour that is
rewarded, and thereby, they are reinforced by the organisation. A behaviour
repeated by one is internalised over a period of time, and these internalise
materials in the collective sense from a sub-culture and eventually integrate
with the culture in the organisation.
v) Celebrations of incidents significant to individual employees and the
organisation are important. Some interesting experiences in some
organisations have shown that these may help not only to develop a strong
organisational identification and thereby contribute to culture, but may also
make organisations more akin to the Indian culture in a broader sense.
Following are two such examples. Petrofils, a successful and fast expanding
company in the joint sector has been using rituals involving the top
management, the employees, and their families. For instance, record
breaking performances are celebrated by rewarding everyone in the
company, so as to symbolise the contribution of all the employees.
Transition from one productive year to the next is marked by a committee of
employees selecting a gift for everyone. For example, in 1985 a new record
for sales was set when a profit of Rs.36 crores on an investment of Rs. 67
crores was made. That year everyone took home a mixer-grinder. A number
of such rituals are being designed, and care is taken to ensure that they
remain meaningful and do not degenerate into mechanistic rituals.
Another interesting ritual is the celebration of birthdays in the Board room
for all employees, from the Chairman to the Khalasi (helper), to strengthen
the feeling of the company being a family. Everyone is given a gift worth
Rs.51 and the item for the year is selected by a group of about 40
employees.
Steel Tubes of India (STI) has evolved a governance-system suited to the
Indian culture, consisting of joint committees (representatives of
management and workers, elected by the entire work force) and Jan Sabha
(representing elected members, departmental councils, best workers awarded
during the past seven years, employees with over 20 years service, senior
managers, departmental heads and directors of the company).

7) Coping with Collective Power
Traditionally industrial relations have been dealt in the framework of Industrial and
labour laws. Unions and associations of employees use collective power to bargain
with the organizations. Although this aspect is undergoing a lot of change, it is still
very important, and a whole block has been devoted to various aspects of workers and
1 4 related issues.

Activity A Human Resource
Development System
Consider the development dimensions in above section and describe how do these
HRD functions are carried out in your organisation.
...............................................................................................................................
...............................................................................................................................
...............................................................................................................................
...............................................................................................................................
...............................................................................................................................

12.5 HUMAN RESOURCE DEVELOPMENT SYSTEM
The combination of the four foci of HRD ( Individuals, Dyades, Collectives,
and Organisation) with four agents of HRD (Self, Immediate boss, HR department,
and Organisations) gives the HRD systems. In matrix representing the HRD
system is given in Exhibit 2 . As will be seen, the elements in the cells are the various
development aspects discussed above. HRD system caters to all human resource units
of the organizations, and all concerned are involved in running
the system.

Exhibit 2 : Matrix of Human Resource Development *

Agents of the HRD Process
Foci of HRD
Person Immediate Personnel or Organisation
(Self) boss HRD Dept.

The Individual
Goal setting 1a, 3a 1a, 3a 3a, 3e 1a
Performance analysis 3a, 3b 3b 3e —
Performance improvement 3a 3b 3e 4a, 5b
Work humanisation 1a 1a 4b 4b, 4c
Education — — 3a 4a
Coping — 3b — 4c
Advancement — 3b 3d, 1b, 1c, 3e 1c, 2b, 2c, 3c,
The Dyad (employee-boss) 3d, 4a
Trust 3b 3b 6 6
Mutuality 3b 3b 6 6
Helping 3b 3b 6 6
The Collectives (teams)
Effectiveness 6, 7 6, 7
Collaboration 6, 7 6, 7
Department/Organisation
Climate 5a, 5b, 5c
Self-renewing 7
Process 6 6

* The numbers in the cells refer to the various development dimensions given in
Exhibit 1

1 5

Human Resource Activity B
Development
Study the above exhibit and develop a similar matrix for your organisation showing
linkages of various development dimensions.
...............................................................................................................................
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...............................................................................................................................
...............................................................................................................................

12.6 PRINCIPLES IN DESIGNING HRD SYESTEM
Of course, HRD systems must be designed differently for different organisations.
Although the basic principles may remain the same, the specific components, their
relationships, the processes involved in each, the phasing, and so on, may differ from
organisation to organisation.
Designing in integrated HRD systems requires a thorough understanding of the
principles and models of human resource development and a diagnosis of the
organisation culture, existing HRD practices in the organisation, employee perceptions
of these practices, and the developmental climate within the organisation. The
following principles related to focus, structure, and functioning should be considered
when designing integrated HRD systems.

Focus of the System
a) Focus on enabling capabilities: The primary purpose of HRD is to help the
organisation to increase its “enabling” capabilities. These include development of
human resources, development of organisational health, improvement of problem
solving capabilities, development of diagnostic ability (so that problems can be
located quickly and effectively), and increased employee productivity and
commitment.
b) Balancing adaptation and change in the organisational culture: Although HRD
systems are designed to suit the organisational culture, the role of HRD may be to
modify that culture to increase the effectiveness of the organisation. There always has
been a controversy between those who believe that HRD should be designed to suit the
culture and those who believe that HRD should be able to change the culture. Both
positions seem to be extreme. HRD should take the organisation forward, and this can
be done only if its design anticipates change and evolution in the future.
c) Attention to contextual factors: What is to be included in the HRD systems, how
is it to be sub-divided, what designations and titles will be used, and similar issues
should be settled after consideration of the various contextual factors of the
organisation—its culture and tradition, size, technology, levels of existing skills,
available support for the function, availability of outside help and so on.
d) Building linkages with other functions: Human resource development systems
should be designed to strengthen other functions in the company such as long-range
corporate planning, budgeting and finance, marketing, production, and other similar
functions. These linkages are extremely important.
e) Balancing specialisation and diffusion of the function: Although HRD involves
specialised functions, line people should be involved in various aspects of HRD.
Action is the sole responsibility of the line people, and HRD should strengthen their
roles.
1 6

Structure of the System Human Resource
Development System
a) Establishing the identity of HRD: It is important that the distinct identity of
HRD be recognised. The person in charge of HRD should have responsibility for this
function exclusively and should not be expected to do it in addition to any other
function. Multiple responsibilites produce several kinds of conflict. This person
should report directly to the chief executive of the organisation.
b) Ensuring respectability for the function: In many companies, the personnel
function does not have much credibility because it is not perceived as a major function
within the organisation. It is necessary that HRD be instituted at a very high level in
the organisation and that the head of the HRD department be classified as a senior
manager. Both the credibility and usefulness of HRD depend on this.
c) Balancing differentiation and integration: The human resource development
function often includes personnel administration, human resource development and
training, and industrial relations. These three functions have distinct identities and
requirements and should be differentiated witin the HRD department. One person may
be responsible for OD, another for training, another for potential appraisal and
assessment, etc. At the same time, these roles should be integrated through a variety of
mechanisms. For example, inputs from manpower planning should be available to line
managers for career planning and HRD units for potential appraisal and development.
Data from recruitment should be fed into the human resources information system. If
salary administration and placement are handled separately, they should be linked to
performance appraisals. Differentiation as well as integration mechanisms are
essential if the HRD system is to function well.
d) Establishing linkage mechanisms: HRD has linkages with outside systems as
well as with internal sub-systems. It is wise to establish specific linkages to be used to
manage the system. Standing committees for various purposes (with membership from
various parts and levels of the organisation), task groups, and ad hoc committees for
specific tasks are useful mechanisms.
e) Developing monitoring mechanisms: The HRD function is always evolving. It
therefore requires systematic monitoring to review the progress and level of
effectiveness of the system and to plan for its next step. A thorough annual review
reappraisal every three years will be invaluable in reviewing and planning the system.
It may be helpful to include persons from other functions in the organisation in the
HRD assessment effort.

Functioning of the System
a) Building feedback and reinforcing mechanisms: The various sub-systems within
HRD should provide feedback to one another. Systematic feedback loops should be
designed for this purpose. For example, performance and potential appraisals provide
necessary information for training and OD, and OD programmes provide information
for work redesign.
b) Balancing quantitative and qualitative decisions: Many aspects of HRD, such as
performance and potential appraisals, are difficult to quantify. Of course attempts
should be made to quantify many variables and to design computer storage of various
types of information, but qualitative and insightful decisions are also necessary and
desirable. For example, in considering people for promotions, quantitative data are
necessary inputs, but other factors must also be taken into consideration. Thus a
balance between the mechanical and the human factors is necessary.
c) Balancing internal and external expertise: A human resource development
system requires the development of internal expertise and resources, specifically in
content areas that are used frequently within the organisation. For expertise that is 1 7

Human Resource required only occasionally, the use of external resources or consultants may be the
Development most feasible. It is necessary to plan for an economical and workable balance between
the two. It is preferable to use internal personnel to conduct training; however, an
organisation that uses only in-house expertise may not benefit from new thinking in
the field. On the other hand, a company that relies solely on external HRD help does
not develop the internal resources that are necessary for effective functioning.
d) Planning for the evolution of HRD: Various aspects of HRD can be introduced
into the organisation in stages, depending on its needs, size and level of sophistication.
Some aspects may require a great deal of preparation. Rushing the introduction of an
aspect of HRD may limit its effectiveness. Each stage should be planned carefully,
with sequenced phases built one over the other. This may include:
i) Geographical phasing introducing the system in a few parts of the organisation
and slowly spreading it to other parts. This may be necessary in a large or widely
located organisation.
ii) Vertical phasing introducing the system at one or a few levels in the organisation
and expanding up or down gradually.
iii) Functional phasing introducing one function or sub-system, followed by other
functions. For example, introducing job specifications (identification of critical
attributes of jobs) before introducing a complete potential-appraisal system.
iv) Sophistication phasing introducing simple forms of sub-systems, followed after
some time by more sophisticated forms.

12.7 CHANGING BOUNDARIES OF HRD
Over time there have been many changes in the HR function. Slowly the term
Personnel Function has been replaced with the term Human Resource or HR Function,
and Personnel departments and Personnel Managers have been re-designated as
Human Resource Departments or Human Resources Managers. The status of the HR
function got very much uplifted across the world, and particularly in India. Lifting up
the HR function to the Director level in the corporations, and representation of HR
Directors on the Board are two significant indicators of the recognition of people as a
resource and partners in business. This is what was envisaged in some ways when the
first HRD department was designed in Larsen & Toubro in mid-seventies. The HR
function also got expanded to include some new initiatives in a few organisations.
Some of the new roles the HR functionaries started performing in the last decade
include the following. Most of these relate to human resource development.
1) Reorganisation and restructuring, including downsizing, rightsizing, flattening
the structure, outsourcing etc.;
2) Managing mergers and acquisitions by changing HR policies, realigning and
redrafting HR policies and practices;
3) Initiating and managing quality initiatives, including quality circles, small
group activities, ISO certification etc.;
4) Conducting a variety of surveys, including climate surveys, employee
satisfaction surveys, internal customer satisfaction surveys, and bench marking
with competitors and others globally;
5) Restructuring salary and reward systems through compensation surveys,
introduction of stock options, performance-linked pay or pay-for-performance,
compensation planning etc.;
6) Enhanced emphasis on recruitment or placement. With the recognition of the
need for competent people, the new economy industries like the IT, Telecom,
Financial services, Insurance, BPO organisations (call centres) have further
1 8 increased their focus on recruitment and outsourcing of recruitment;

7) Introducing new technologies of training, including e-learning, on-line Human Resource
education, distance learning, off campus learning, web based learning and use of Development System
other technologies for learning;
8) Starting of Corporate Universities and in-house training institutions and
academies to encourage continuous education programmes and competency
building;
9) Introduction of 360 Degree Feedback, including using it for leadership
development, evolving leadership models that fit into the company culture and
take care of the unique needs of the company, and exploring it as an individual as
well as performance development tools, experimenting with 360 degree feedback
by linking with reward systems;
10) Use of Assessment Centres or Development centres for identifying, developing
and promoting talented individuals, starting of fast track systems, identification
of high potential employees and designing retention strategies;
11) Increased emphasis on mentoring and coaching;
12) Increased emphasis on training of all employees, particularly operators,
workmen etc., through multi-skilling, etc.,
13) Emphasis on leadership and leadership development at all levels; and
14) Participation in strategic thinking, business planning, mergers, acquisitions etc.
15) Improving quality of work life. This has been has been brought into focus by
the IT industry where the environment becomes a critical factor in effective
functioning of knowledge workers.
All these new developments of the last decade are in the direction of making HR,more
specifically HRD, a strategic business partner. Recently HR team from one company
in India suggested seven ways of making HR a business partner (See Exhibit 3).

Exhibit 3: Making HR a Business Partner

1) Train HR people in business to get a holistic business perspectives
2) Get involved in larger organisational issues and handle coordination at that level
3) Align HR strategies with business strategies
4) Keep in mind business strategy while designing training programmes
5) Convene business strategies forums, hold strategic discuss meetings, and prepare
discussion paper
6) Initiate process of discussion on strategy formulation from the front-line upward
7) Help in searching state of the art practices to discuss with the business team.
Source: HR Group of Turner-Morrsion, July, 1998.
These new functions fall into one or more of the categories of the HRD system,
shown in Exhibit 2. The classification suggested earlier is only indicative.
Organisation can structure their function the way that suits their requirements. The
principles remain the same. The boundary gets extended to participation in strategy
and business planning (including planning of mergers, acquisitions, expansions,
consolidations etc.). The HRD systems model is broad enough to include the new roles
of HR managers.
Researches have shown that effective firms adopt some of the following HR
practices:
l Financial incentives for excellent performance
l Practices that motivate employee effort and capture the benefits of know-
how and skill 1 9

Human Resource l Rigorous selection and selectivity in recruiting
Development
l Higher than average wages
l Plans of employee share of ownership
l Extensive information sharing
l Decentralisation of decision-making and empowerment
l Self-managing teams
l High investment in training and skill development
l Having people do multiple jobs and job-rotation
l Elimination of status symbols
l A more compressed distribution of salaries across and within levels
l Promotion from within
l Long-term perspective
l Measurement of HR practices and policy implementation

12.8 SUMMARY
Today every successful organisation pays adequate attention to their HRD functions.
To obtain full benefits of HRD, it should be introduced as a system and should be
updated to keep track with the changing boundaries. If implemented, properly,
integrated HRD systems can contribute significantly to positive cultural changes,
increased productivity and excellence in organisation.

1) Describe the concept of HRD and its need in present industrial scenario.
a) Communiction
b) Developing equitability
c) Coping with collective power
3) Discuss how organisational culture can be developed.
4) What are the principles in designing a HRD system?
5) Write an overview of the changing boundaries of HRD.

Pareek, V. and Rao, T.V. (1981). Designing and Managing Human Resource
Systems, Oxford & IBH Publishing Co., New Delhi.
Rao, T.V. and Pereira, D.F. (1986). Recent Experiences in Human Resource
Development, Oxford & IBH Publishing Co., New Delhi.
Ulrich, D. (1997). Human Resource Champions , Harvard Business School Press.
Kaplan, R. (1992). “Balance Score Card”, Harvard Business Review,
January-February.
Pfeffer (1994). Competitive Advantage through People, Harvard Business School Press.
Tripathi, P.C. (2003). Human Resource Development, Sultan Chand & Sons,
New Delhi.
2 0

Training
UNIT 13 TRAINING
Objectives

l explain the meaning of training;
l discuss the need and importance of training;
l describe various methods of training;
l suggest a training system;
l identify areas for evaluation of training;
l discuss ways of making training more strategic;
l explain the concept of retraining; and
l elaborate dimensions of organizational learning.

Structure
13.1 Introduction
13.2 Defining Training
13.3 Needs and Benefits of Training
13.4 Organising Training Programmes
13.5 A Suggested Training System
13.6 Evaluation of Training
13.7 Retraining
13.8 Some Issues in Training
13.9 The Present Status of Training
13.10 Making Training a Strategic Function
13.11 Towards Learning Organisation
13.12 Summary

13.1 INTRODUCTION
Training is required at every stage of work and for every person at work. To keep
oneself updated with the fast changing technologies, concepts, values and
environment, training plays a vital role. Training programmes are also necessary in
any organisation for improving the quality of work of the employees at all levels. It is
also required when a person is moved from one assignment to another of a different
nature. Taking into account this context, this unit aims at providing insight into the
concept, need and methods of training, also areas of evaluation of training, retraining
and dimensions of organisational learning.

2 1

Human Resource
Development 13.2 DEFINING TRAINING
Training is the most important function that directly contributes to the development of
human resources. This also happens to be a neglected function in most of the
organisations. Recent surveys on the investments made by Indian organisations on
training indicate that a large number of organisations do not even spend 0.1 per cent
of their budget on training. Many organisations do not even have a training
department. If human resources have to be developed, the organisation should create
conditions in which people acquire new knowledge and skills and develop healthy
patterns of behaviour and styles. One of the main mechanisms of achieving this
environment is institutional training. Training is a short-term process utilising a
systematic and organised procedure by which personnel acquire technical knowledge
and skills for a definite purpose.

13.3 NEEDS AND BENEFITS OF TRAINING
Training is essential because technology is developing continuously and at a fast rate.
Systems and practices get outdated soon due to new discoveries in technology,
including technical, managerial and behavioural aspects. Organisations that do not
develop mechanisms to catch up with and use the growing technology soon become
stale. However, developing individuals in the organisation can contribute to its
effectiveness of the organisation.
There are some other reasons also for which this training becomes necessary.
Explained below are various factors, giving rise to the need for training.
l Employment of inexperienced and new labour requires detailed instructions for
effective performance on the job.
l People have not to work, but work effectively with the minimum of supervision,
minimum of cost, waste and spoilage, and to produce quality goods and services.
l Increasing use of fast changing techniques in production and other operations
requires training into newer methods for the operatives.
l Old employees need refresher training to enable them to keep abreast of changing
techniques and the use of sophisticated tools and equipment.
l Training is necessary when a person has to move from one job to another
because of transfer, promotion or demotion.
Such development, however, should be monitored so as to be purposeful. Without
proper monitoring, development is likely to increase the frustration of employees if
when, once their skills are developed, and expectations raised, they are not given
opportunities for the application of such skills. A good training sub-system would help
greatly in monitoring the directions in which employees should develop in the best
interest of the organisation. A good training system also ensures that employees
develop in directions congruent with their career plans.
Hence, a well-planned and well-executed training programme should result in:
l reduction in waste and spoilage;
l improvement in methods of work;
l reduction in learning time;
l reduction in supervisory burden;
l reduction in machine breakage and maintenance cost;
l reduction in accident rate;
2 2 l improvement in quality of products;

l improvement in production rate; Training

l improvement of morale and reduction in grievances;
l improvement of efficiency and productivity;
l reduction in manpower obsolescence;
l enabling the organisation to provide increased financial incentives, opportunity
for internal promotion and raising of pay rates;
l wider awareness among participants, enlarged skill; and
l personal growth.

13.4 ORGANISING TRAINING PROGRAMMES
A good system of training starts with the identification of training needs. The
following sources can be used for identifying training needs.

Performance Review Reports
Performance review reports help in identifying directions in which the individuals
should be trained and developed. On the basis of the annual appraisal reports, various
dimensions of training can be identified. Training needs identified on the basis of
performance appraisal, provide good information for organising in-company training,
and on-the-job training for a select group of employees.

Potential Appraisal
Training needs identified on the basis of potential appraisal, would become inputs for
designing training programmes or work-out training strategies for developing the
potential of a selected group of employees who are identified for performing future
roles in the organisation.

Job Rotation
Working in the same job continuously for several years without much change may
have demotivating effects. Some organisations plan job rotation as a mechanism of
maintaining the motivation of people. Training is critical in preparing the employees
before placing them in a new job.

Continuing Education
Besides these, most of the training programmes that are organised today, aim at
equipping the managers with new technology. These training programmes attempt to
help the managers raise their present level of effectiveness.
A) Methods of Training
Analysis of an Activity: List in a logical sequence, the activities in producing product
or service or part thereof, and determine what new knowledge or skill is called for or
which aspects of present knowledge or skill need to be modified.
Analysis of Problems: To analyse ‘problems’ and determine what additional skills,
knowledge or insights are required to handle it.
Analysis of Behaviour: To analyse typical behaviour by individuals or groups and
determine the corrective action involving training.
Analysis of an organisation: To analyse organisational weaknesses to produce clues
to both individual and group training needs.
Appraisal of Performance: To analyse performance and determine if someone should
get something, be it additional knowledge, skill or understanding. 2 3

Human Resource Brainstorming: To bring together a homogenous group and to ask individuals in the
Development group to call out any ideas they have for answering a ‘how to’ question and identify
items which call for additional knowledge, skill or attitude.
Buzzing: To ask an audience of supervisors, managers, professional, personnel or
others (as long as it is homogenous), as to what the desirable next steps are in the
organisation’s training programme or ‘what additional areas of knowledge (or skill or
understanding), do we need to handle our work better’.
Card Sort: To write statements or potential training needs on cards, hand them over to
the persons whose ideas are sought, to arrange these cards in what they feel is their
order of importance for various training needs.
Checklist: To break down a job, process, programme, activity, or area of
responsibility into a list of detailed parts or steps arranged in logical sequence. Then
to have checked off by each employee the items about which he feels he would like to
have more skill or knowledge.
Committee: To constitute an advisory committee composed of persons responsible for
or with a direct interest in an activity to identify training needs.
Comparison: To compare what an individual is doing (or contemplates doing) with
what others are doing or have done to learn about new ways to handle old problems,
keep up-to-date on new techniques and procedures, and fight his own obsolescence.
Conference: To identify training needs and make decisions on ways these needs shall
be met.
Consultants: To employ outside consultants to determine training needs and develop
ways to meet them.
Counselling: To discuss between a training practitioner and a person seeking guidance
regarding way he can improve his on-the-job performance or prepare for
advancement.
In-basket: To measure or test a manager’s ability to handle some of the day to day
challenges which come to him in writing in his ‘in-box’ from various sources.
Incident Pattern: To note in terms of success or failure, the responses to special
situations and to study the pattern of deviation.
Informal Talks: To meet and talk informally with people for finding clues to training
needs.
Interviews: To arrange a formal meeting with the person or group concerned
employing the interview techniques.
Observation: To observe such things as may have value as indicators of training
needs, especially needs which are just under-the-surface or emerging.
Problem Clinic: To arrange meetings of a homogenous group to discuss a common
problem and develop a solution.
Research: To identify implications for training and development as a result of
research.
Role Playing: To get clues to his training needs in a skill, an area of knowledge, or in
understanding or attitude by observing how each role player acts in a role playing
situation.
Self-analysis: To self-evaluate and know what is needed in theory, additional
knowledge, skill or insight.
Simulation: To analyse performance in simulated exercise to reveal individual and/or
2 4 group training needs.

Skill Inventory: To establish and annually update an inventory of the skills of their Training
employees and to identify gaps or blind spots in reserve or stand-by-skills.
Slip Writing: To write on a slip the type of training needed and analyse the
information on these slips.
Studies: To undertake studies which can turn up training needs which will have to be
met if the plans were adopted.
Surveys: To undertake surveys that can be used to take inventory of operations,
employee attitudes, implications of advanced planning, etc.
Tests: To perform tests to measure skill, knowledge or attitude and to identify gaps.
Task Force: To constitute a task force which, in analysing the problem may unearth
training needs which must be met before their recommended solution to the problem
can be implemented.
Questionnaire: To develop a questionnaire to elicit information which can be used to
determine training needs, delimit the scope of the training, identify course contents,
etc.
Workshop: To identify in a workshop, the need for further understanding or insight
about organisation goals or operations.
Activity A
You may be aware of how training needs are determined in your organisation. If not,
you may contact your Personnel Department for the purpose. Write below the ten
most commonly used methods for identifying training needs.
1) ..........................................................................................................................
2) ..........................................................................................................................
3) ..........................................................................................................................
4) ..........................................................................................................................
5) ..........................................................................................................................
6) ..........................................................................................................................
7) ..........................................................................................................................
8) ..........................................................................................................................
9) ..........................................................................................................................
10) .........................................................................................................................
B) Formulation of Training Objectives
As you have seen earlier, the first objective of training is to prepare employees for the
job meant for them while on first appointment, on transfer, or on promotion, and
impart to them the required skill and knowledge. The second objective is to assist the
employees to function more effectively in their present positions by exposing them to
the latest concepts, information, techniques, and developing the skills that would be
required in their particular fields. The third objective is to build a second line of
competent officers and prepare them to occupy more responsible positions.
C) Formulation of Training Policy
Even though training is primarily the responsibilsity of the Personnel Department, a
suitable training policy has to be evolved by the top management. It should reflect the
primary and secondary objectives mentioned above. A training policy should be able
to provide answers to the following questions:
2 5

Human Resource 1) What do you want and hope to accomplish through training?
Development
2) Who is responsible for the training function?
3) Should the training be formal or informal?
4) What are the training priorities?
5) What types of training is needed?
6) When and where should training be given?
7) Should training be continuous or casual?
8) How much should the employees be paid during training?
9) Which outisde agencies should be associated with training?
10) How should training be related to labour policy?
D) Principles of an Effective Training Programme
A successful training programme should be based on the following principles:
1) The objectives and scope of a training plan should be defined before its
development is begun, in order to provide a basis for common agreement and co-
opertive action.
2) The techniques and processes of a training programme should be related directly
to the needs and objectives of an organisation.
3) To be effective, the training must use tested principles of learning.
4) Training should be conducted in the actual job environment to the maximum
possible extent.

Principles of Learning
Certain principles are followed for developing effective training programmes.
Some of these are described below:
1) Every human being is capable of learning.
2) An adequate interest in and motive for learning is essential because people are
goal-oriented.
3) Learning is active, and not passive.
4) People learn more and faster when they are information of their achievements.
5) People learn more by doing than by hearing alone.
6) Time must be provided to practise what has been learnt.
7) A knowledge of the standards of performance makes learning effective.
8) Learning is a cumulative process. An individual’s reaction to any lesson is
conditioned and modified by what has been learned by him in earlier lessons and
by previous experience.
9) Early success increases an individual’s chances for effective learning.
10) Effective learning results when initial learning is followed immediately by
application.
11) The rate of learning decreases when complex skills are involved.
12) Learning is closely related to attention and concentration.
13) Learning is more effective when one sheds one’s half-knowledge, prejudices,
biases, likes and dislikes.
14) Learning to be successful should be related to a learner’s experiences in life.
2 6 15) Trainees learn better when they learn at their own pace.

E) Training Methods Training

Various methods of training have been evolved and any one method, or a combination
of any two or more of these can be used, depending upon the training requirements
and the level of people to be trained.
Training for Different Employees
The employees who are to be trained can be different types and each type would
require a different type of training.
Unskilled workers are given training in improved methods of handling machines and
materials. The objective here is to secure reduction in cost of production and waste.
Training is given on the job itself, by immediate superior officers.
Semi-silled workers require training to cope with requirements arising out of adoption
of mechanisation, rationalisation and technical processes. Training is given by more
proficient workers, bosses or inspectors. It may be given either in the section or
department of the worker or in segregated training shops.
Skilled workers are given training through apprenticeship in training centres or in the
industry itself.
Salesmen are trained in the art of salesmanship, in handling customers, planning their
work, and facing challenges of market place. Supervisory staff constitute a very
important link in the chain administration. They have to cope with the increasing
demands of the enterprise in which they are employed and to develop team spirit
among people under their charge. A training programme for them should aim at
helping the supervisors to improve their performance, and to prepare them for
assuming greater responsibilities at higher levels of management.
All training methods can be broadly classified as (a) on-the-job-methods, and
(b) off-the-job methods.
a) On-the-job-Methods
Under these methods the principle of learning by doing is used. These methods are
briefly described below:
1) On-the-job Training: An employee is placed in a new job and is told how it is to
be performed. It aims at developing skills and habits consistent with the existing
practices of an organisation and by orienting him to his immediate problems.
Coaching and instructing is done by skilled workers, by supervisors, or by
special training instructors. A variety of training aids and techniques are used
such as procedure charts, lecture manuals, sample problems, demonstrations,
oral and written explanations, tape recorders, etc.
2) Vestibule Training or Training-Centre: It involves classroom training imparted
with the help of equipment and machines identical to those in use at the place of
work. Theoretical training is given in the classroom, while practical work is
conducted on the production line. It is often used to train clerks, bank tellers,
inspectors, machine operators, typists, etc.
3) Simulation: It is an extension of vestibule training. The trainee works in closely
‘duplicated’ real job conditions. This is essential in cases in which actual on-
ste-job practice is expensive, might result in serious injury, a costly error or the
destruction of valuable material or resources, e.g. in aeronautical industry.
4) Demonstration and Examples: Here the trainer describes and demonstrates how
to do a certain work. He performs the activity himself, going through a step-by-
step explanation of the ‘why’, ‘how’ and ‘what’ of what he is doing.
Demonstrations are often used in combination with lectures, pictures, text
material, discussion, etc. The emphasis under this method is on know-how.
2 7
The principles and theory of a job must be taught by some other methods.

Human Resource 5) Apprenticeship: A major part of training time is spent on the on-the-job
Development productive work. Each apprentice is given a programme of assignments
according to a predetermined schedule which provides for efficient training in
trade skills. This method is appropriate for training in crafts, trades and technical
areas, specially when proficiency in a job is the result of a relatively long
training or apprenticeship period, e.g., job of a craftsman, a machinist, a printer,
a tool maker, a pattern designer, a mechanic, etc.
b) Off-the-job or Classroom Methods
Training on the job is not a part of every day activity under these methods. Location
of this training may be a company classroom, an outside place owned by the
organisation, an education institution or association, which is not a part of the
company.
These methods are:
1) Lectures: These are formally organised talks by an instructor on specific topics.
This method is useful when philosophy, concepts, attitudes, theories and problem
solving have to be discussed. The lectures can be used for a very large group to
be trained in a short time. These are essential when technical or special
information of a complex nature is to be imparted. The lectures are supplemented
with discussions, film shows, case studies, role-playing, etc.
2) The Conference Method: Under this method, a conference is held in accordance
with an organised plan. Mutual problems are discussed and participants pool
their ideas and experience in attempting to arrive at better methods of dealing
with these problems. The members of the group come to teach each other and to
learn together. Conferences may include Buzz sessions which divide Conferences
into small groups of four or five for intensive discussions. These small groups
report back to the whole group with their conclusions or questions. This method
is ideally suited for analysing problems and issues, and examining them from
different viewpoints. It helps in developing conceptual knowledge, reducing
dogmatism and modifying attitudes.
However, it is suitable only for a small group of, say 20-30 persons, because a
larger group often discourages active participation of all the conferees. Under
this method the conferees should have some knowledge of the subject to be
discussed. They should be good stimulating leaders who can adopt a flexible
attitude and encourage members to express themselves without fear. They should
also control the more verbose members while bringing out the more reserved.
They can develop sensitivity to the thoughts and feelings of individuals,
summarise material at appropriate times during a discussion, and ensure a
general consensus on points without forcing agreement or side-stepping
disagreements.
3) Seminar of Team Discussion: The group learns through discussion of a paper
on a selected subject. The paper is written by one or more trainees. Discussion
may be on a statement made by the person in charge of the seminar or on a
document prepared by an expert. The material to be analysed is distributed in
advance in the form of required reading.
4) Case Discussion: Under this method, a real (or hypothetical) business problem
or situation demanding solution, is presented to the group and members are
trained to identify the problems present, they must suggest various alternatives
for tackling them, analyse each one of these, find out their comparative
suitability, and decide for themselves the best solution. The trainer only guides
the discussion and in the process ensures that no relevant aspect is left out of
discussion, and adequate time is spent on each aspect. This method promotes
2 8

analytical thinking and problem-solving ability. It encourages open-mindedness, Training
patient listening, respecting others’ views and integrating the knowledge obtained
from different basic disciplines. Incidentally, it enables trainees to become
increasingly aware of obsecurities, contradictions and uncertainties encountered
in a business. This method is extensively used in professional schools of law and
management, and in supervisory and executive training programmes in industry.
5) Role-Playing: This method is also called ‘role-reversal’, ‘socio-drama’ or
‘psycho-drama’. Here trainees act out a given role as they would in a stage play.
Two or more trainees are assigned roles in a given situation, which is explained
to the group. There are no written lines to be said and, naturally, no rehearsals.
The role players have to quickly respond to the situation that is ever changing
and to react to it as they would in the real one. It is a method of human
interaction which involves realistic behaviour in an imaginary or hypothetical
situation.
Role playing primarily involves employee-employer relationships, hiring, firing,
discussing a grievance problem, conducting a post appraisal interview,
disciplining a subordinate, or a salesman making presentation to a customer.
6) Programme Instruction: This involves two essential elements: (a) a step-by-step
series of bits of knowledge, each building upon what has gone before, and (b) a
mechanism for presenting the series and checking on the trainee’s knowledge.
Questions are asked in proper sequence and indication given promptly whether
the answers are correct.
This programme may be carried out with a book, a manual or a teaching
machine. It is primarily used for teaching factual knowledge such as
Mathematics, Physics, etc.
Activity B
Find out about the various training programmes used in your organisation, as also the
types of employees for whom each is used and what it seeks to accomplish. Write
these below:
Programme Employees for What it seeks to
whom used accomplish
1) ................................ ................................ ................................
1) ................................ ................................ ................................
2) ................................ ................................ ................................
3) ................................ ................................ ................................
4) ................................ ................................ ................................
5) ................................ ................................ ................................
6) ................................ ................................ ................................
7) ................................ ................................ ................................
8) ................................ ................................ ................................
9) ................................ ................................ ................................
10) ................................ ................................ ................................
F) Responsibility for Training
If you have realised that training is quite a stupendous task, which cannot be done by
one single department, you are right in your thinking.
2 9

Human Resource In fact, total responsibility for training has to be shared among:
Development
l The top management who should frame and authorise the basic training policies,
review and approve the broad outlines of training plans and programmes, and
approve training budgets.
l The personnel department, which should plan, establish and evaluate
instructional programmes.
l The supervisor who should implement and supply the various developmental
plans.
l Employees, who should provide feedback, revision and suggestions for
improvement in the programme.

13.5 A SUGGESTED TRAINING SYSTEM
After identifying the training needs, the next step is to design and organise training
programmes. In large companies it is possible for the training department to organise
several in-company training programmes.
For designing the training programme on the basis of the training needs, the following
points may be kept in view:
1) Wherever there are sizeable number of people having the same training needs, it
is advisable to organise an in-company programme. The organisation can save a
lot of cost. Besides, by having the group of people from the same work place
mutuality can be inculcated. The probability of the trainees actually applying
what they have learnt is high because of high group support.
2) Whenever new systems have to be introduced training is needed to develop
competencies needed to run the systems.
3) It is better to aim at in-company programmes for technical skills wherever
possible and outside programmes for managerial and behavioural development.
4) People performing responsible roles in the organisation should be encouraged to
go out periodically for training where they would have more opportunities to
interact with executives of other organisations and get ideas as well as stimulate
their own thinking.
5) The training department should play a dynamic role in monitoring the training
activities. It should continuously assess the impact of training and help the
trainees in practising whatever they have learnt.
6) Whenever an individual is sponsored for training he should be told categorically
the reasons for sponsoring him and the expectations of the organisation from him
after he returns from the programme.
Most companies do not inform the employees why they have been sponsored; such a
practice reduces learning, as the employees sponsored are more concerned about the
reasons for being sponsored than actually getting involved in and benefiting from the
training.

13.6 EVALUATION OF TRAINING
Many organisations, especially industries, have been concerned with the difficult but
critical question of evaluation. Training managers or organisers are also concerned
with this question. All books on training have dealt with this issue, but no satisfactory
and comprehensive accounts of evaluation are available.
3 0

For the preparation of a comprehensive conceptual framework of training evaluation Training
and an effective strategy of evaluating training programmes and system, it is
necessary to consider several aspects of evaluation. The basic question in this regard
relates to the value of evaluation: why evaluate training? Hamblin has discussed this
question very well—that evaluation helps in providing feedback for improvement (and
better control) of training. When we discuss feedback and improvement, two relevant
questions are raised: feedback to whom? Improvement of what? The former question
relates to the main client groups, and the latter to the main dimensions and specific
areas of evaluation.
Two additional questions are: how should evaluation be done? What specific ways
should be adopted for it? These questions relate to the design and techniques of
evaluation, respectively.

A) Main Clients
There are several partners in the training act and process, and all of them are the client
of evaluation. Their needs for feedback and use of feedback for improvement (control)
will naturally be different with some overlapping. There are four main partners in
training (and clients for evaluation):
1) The participants or learners (P)
2) The training organisation or institute (I) including
a) Curriculum planners (CP)
b) Programme designers (PD)
c) Programme managers (PM)
3) The faculty or facilitators or trainers (F)
4) The client organisation, the ultimate user and financier of training (O)
Literature on training evaluation has not paid due attention to this respect.

B) Dimensions of Evaluation
Attention has been given to the main dimensions of training, and most of the suggested
models are based on these. Four main dimensions have usually been suggested:
contexts, inputs, outputs, and reaction. The last dimension is not in the same category
as the other three. Reaction evaluation can be of contextual factors, training
inputs, and outcomes of training.
In all discussions of training evaluation the most neglected aspect has been the
training process which cannot be covered by training inputs. The climate of the
training organisation, the relationship between participants and trainers, the general
attitudes and approaches of the trainers, training methods, etc., are very important
aspects determining the effectiveness of training. Evaluation of the training process,
therefore, should constitute an important element. We may thus have four main
dimensions of evaluation: evaluation of contextual factors (C), evaluation of training
inputs (I), evaluation of training process (P), and evaluation of training outcomes (O).

C) Areas of Evaluation
The various areas of training evaluation need more attention and elaboration. Seven
main areas, with some sub-areas under each, are suggested for consideration. These
are shown in Exhibit 1 in sequential order; the exhibit also shows the conceptual
model of training, by relating the areas to the dimensions. This model is based on the
following assumptions.

3 1

Human Resource Exhibit 1 : Coverage of Evaluation
Development
Area of Evaluation Dimension
1) Pre-training Factors Context
a) Preparation
b) Learning Motivation
c) Expectations
2) Training Events
a) Curriculum Including
b) Specific Events
c) Specific Sessions
3) Training Management Context
a) Areas of Satisfaction/Dissatisfaction
b) Training Facilities
c) Other Facilities
4) Training Process
a) Learning Climate
b) Training Methods (Pedagogy)
c) Trainer Team Effectiveness
5) Participant Development Outcome
a) Conceptual Development
b) Learning of Skills
c) Change in Values/Attitudes
d) Change of Behaviour
e) Application
6) Organisational Development Outcome
a) Job Effectiveness
b) Team Effectiveness
c) Organisational Effectiveness
7) Post-training Factors Context
a) Cost
b) Organisational Support
c) Organisational Factors Hindering
or Facilitating Use of Training

1) Effectiveness of training depends on the synergic relationship and collaborative
working amongst the four major partners of training (participants, training
organisation, trainers and client organisation). Hence evaluation should provide
the necessary feedback to these for contributing to training effectiveness.
2) Training effectiveness depends not only on what happens during training, but
also on what happens before the actual training (pre-training factors) and what
happens after the training has formally ended (post-training factors). Evaluation
cannot neglect these important contextual factors.
3) Various aspects of the training process that are not direct training inputs (for
example also contribute to its effectiveness. Evaluation should, therefore, also
3 2
focus on these factors.

4) The focus or the main task of evaluation should not only be in the nature of Training
auditing (measuring training outcomes in terms of what has been achieved and
how much), but should also be diagnostic (why the effectiveness has been low or
high), and remedial (how effectiveness can be raised).

D) Design of Evaluation
The overall design of evaluation helps in planning the evaluation strategy in advance.
Evaluation designs can be classified in various ways. Two important dimensions,
however, are the time when evaluation is done (or data are collected), and the group,
or groups involved in evaluation (or data collection). Data on relevant aspects may
either be collected only once after the training is over, or on two (or several) occasions
before training interventions, and later again, after the training is over. On the other
hand, only one or more group that undergoes training may be involved in evaluation.
These methods give us four basic designs of evaluation.
Longitudinal design (L) is one in which data are collected from the same group over a
length of time , usually on several occasions, but at least twice, i.e., before and after
training. In the latter case, it is called “before-after” design.
In ex post facto design (E), data are collected from the group which has been exposed
to training only after the training is over. Obviously, this design has inherent
limitations in drawing conclusions from evaluation. But in many practical situations
this is reality, and is a challenge for evaluation designers to devise ways of extracting
the most in such a design.
Comparative survey design (S) may involve collection of data from many other
groups, in addition to the group exposed to training. In this design also there is no
control and there are limitations in drawing conclusions.
The design with a great deal of control and sophistication is the matched group design
(M). Several variations of this design can be used. Another group, matched on some
significant dimensions with the group being exposed to training, can be identified, and
data can be collected from both, once (ex post facto) or several times (longitudinal).
Or, matched sampling can be selected for a comparative or cross-sectional survey. The
design can be made very sophisticated with several matched groups (one with training
“treatment”, another with a different type of treatment, and the third with no
treatment, combined with E and L designs, and making it a “blind” study investigators
not knowing which group is of what category). Both experimental and quasi-
experimental designs can be used.
Enough literature on these designs is available. Hamblin has referred to some of these,
but not in a systematic way. He makes a distinction between the “scientific” approach
(rigorous evaluation to test hypotheses of change) and the “discovery” approach
(evaluation to discover intended and unintended consequences). This distinction does
not serve any purpose and is, in fact, misleading. There can be variations in the degree
of sophistication and rigour. Also, there may be different objectives of evaluation.
Evaluation may be used as part of the training process to provide feedback and plan
for using feedback. Evaluation may be made to find out what changes have occurred
in terms of scope, substance and sustenance in the letter case, the design will be more
complex and more sophisticated. As already discussed, the purpose of evaluation will
began on the main clients of evaluation and what they want to know.

E) Evaluation Techniques
These can be classified in various ways. One way to classify them into response
(reactive) techniques (R). Techniques requiring some kind of response produce some
reaction in those who are responding. The very act of asking people questions (orally
or in a written form) may produce change. Since they produce reactions they are
3 3
called response or reactive techniques.

Human Resource Other techniques can be called unobtrusive measures or secondary source data
Development technique(s); the word “unobstrusive” being borrowed from Webb et al. (1970). These
make use of available data or secondary source data. Hamblin calls them “keyhole”
techniques, thereby expressing his disapproval of such measures.’ There is no reason
to consider such measures as unethical. All indicators, indexes, etc., are such
measures. For example, to measure whether general morale has improved in a unit, it
may be more useful to use secondary source data like examining figures of
absenteeism rather than asking questions. Similarly, an unobtrusive measure or
secondary source data may be much more creative and imaginative and need to be
discovered and used more often for evaluation. However, if some data are collected
about individuals’ behaviour (whether by asking others or unobtrusively) without their
knowledge and approval, which may be unethical. This applies as much to responsive
techniques as to unobtrusive ones, because collecting information from a third person
without the approval or knowledge of the person being studied, is unethical.
Another non-reactive technique, a very old one, is that of observation (O).
Observation can also become a reactive technique if persons being observed know that
they are being observed.
The method of data collection for response or reaction techniques (R) may include
interviews, written reactions (questionnaires, scales, open-ended forms), and
projective techniques. One additional method in this category worth mentioning is
group discussion and consensus report. In many cases, discussion by a small group
consisting of individuals having experience and with a adequate knowledge about it
may give better evaluation results than figures calculated from routine responses.
Advances in scaling techniques have made the greatest contribution to the
development of evaluation techniques. Techniques based on well-prepared instruments
to measure various dimensions are being increasingly used. Various methods of
scaling can be used to develop effective evaluation techniques. The three well-known
scaling techniques associated with Thurstone, Likert, and Guttman, can be
imaginatively used in preparing new evaluation tools. More recent developments have
opened new vistas for sophistication in evaluation work.
Hamblin has done as excellent job in discussing the studies in training evaluation to
illustrate the techniques used. His book will be found very useful for this. Whitelaw has
also cited some studies but has not been able to integrate them. At the end of his book,
Hamblin has summarised the various techniques discussed under his five-level model.
Reaction Session: Reaction scales, reactions notebooks and participation, observers’
records, studies of inter-trainee relationships, end-of-course reaction form, post-
reactions questionnaires and interviews, and expectations evaluation.
Learning: Pre-course questionnaires to instructors; programmed instruction;
objective tests, essay-type written or oral examinations, assessment by trainees of
knowledge changes; skill and task analyses, standardised tests of skill; tailor-made
techniques for evaluating skill, assessment by trainees of skill changes; standardised
attitude questionnaires; tailor-made attitude questionnaires; semantic differential
scales; and group feedback analysis.
Job Behaviour: Activity sampling; SISCO and Wirdenius techniques; observers’
diaries; self-diaries with interview and questionnaires; appraisal and self-appraisal;
critical incident technique; observation of specific incidents, depth interviews and
questionnaires; open-ended depth techniques; and prescription for involving
management in the training process.
Organisation: Indexes of productivity, labour turnover, etc., studies of organisational
climate; use of job behavioural objectives to study behaviour of non-trainees; and
work flow studies.
3 4 Ultimate Value: Cost-benefit analysis and human resources accounting.

An illustration of systematic evaluation has been given in Illustration 1. Training

Illustration 1: An Illustration of Systematic Evaluation

A good example of systematic evaluation is available from a study of the State
Bank Staff College (SBSC) titled, Training Evaluation System: Branch Manager
Programme-A Study on the Impact of Training on Branch Managers. This is one
of the several reports the State Bank Staff College is planning to bring out on their
programmes. In this report they have taken the branch management programme
for evaluation. Management programmes were organised by the State Bank Staff
College for rural branches, urban/metropolitan branches, industrial branches, and
agricultural development branches. Eight programmes, completed between
October 1976 and April 1977, were taken up for evaluation. About 206 branch
managers from various circles of the bank had participated in these programmes.
In the study, the framework of evaluation has been stated in the beginning
emphasising: pre-training stage (performance gaps); training stage (training
design); and post-training stage (assessment whether the gaps were filled). In order
to measure the impact of training on various aspects, Key Responsibility Areas
(KRAS) of the branch managers have been identified as follows: business, quality
of advances, external service, internal administration, and staff relations. These
have been analysed into the performance process and performance results. The
objectives of the training programme have been analysed in relation to these areas.
As part of the evaluation study, both participants and the “controlling authorities”
were approached. It was very encouraging to note that 92 per cent of the
participants and 85 per cent of the controlling authorities responded to the study at
the pre-training stage; for the post-training stage the figures were 51 and 56 per
cent respectively. Written questionnaires were used and interviews were
conducted. In addition to questions on various aspects of the role of branch
managers and the KRAS, some psychological measures were also included:
working in the organisation; job related items; leadership style (Fiedler’s LPC
scale); and interpersonal orientation (FIRO-B).

13.7 RETRAINING
Retraining programmes are designed as a means of avoiding personal obsolescence. It
is the tendency of the individual worker to become outdated in terms of job
requirements. This is true of employees at every level in the organisation.
However, retraining is focused on rank-and-file workers. This is so because their
number is large and technological change makes its immediate impact on those who
work closer to technological resources. Besides they are less equipped to foresee their
personal needs and because they require more assistance in advance planning than do
others.
Workers require refresher courses to help them recall what they have forgotten and to
overcome some practices they have come to accept as satisfactory. They also need to
bring them with respect to relevant new knowledge and skill. The need for retraining
also arises as a result of technological changes resulting in changes in equipment,
tools, and work methods.

13.8 SOME ISSUES IN TRAINING
Improvement of training in organisations requires paying attention to some critical
dimensions. The role of training for development of people and organisations has been
3 5
discussed separately in detail, including pre-training work, curriculum development,

Human Resource selection of methods, building a training establishment and post-training support and
Development follow-up (Lynton and Pareek, 2000). However, a few important dimensions which
require special attention in organisations are discussed here.

1) Learning
The main function of training is to facilitate learning. The most effective learning is
self-initiated and self-managed learning. Training should help in developing a culture
of self-managed learning. In general, learning by discovery is more internalised and is
longer-lasting than didactic learning from others.
Below are suggested 15 different conditions to make learning effective.
For this purpose, learning has been defined as “the process of acquiring,
assimilating, and internalising cognitive, motor or behavioural inputs for their
effective and varied use when required, and leading to enhanced capability of further
self-monitored learning”.
i) Authentic and open system of training institution or the place of learning.
ii) Non-threatening climate.
iii) Challenging learning tasks.
iv) Collaborative arrangements for mutual support of learners.
v) Organisation of graduated experiences of challenging successes.
vi) Mechanisms for supportive and quick feedback.
vii) Opportunities to practise the skills learnt.
viii) Opportunities to apply learning.
ix) Opportunities for and encouragement to self-learning.
x) Opportunities for and support to experimentation.
xi) Emphasis on learning through discovery.
xii) Indirect and liberating influence by trainer/teacher through minimum guidance.
xiii) Trainer’s/teacher’s human values and faith in man.
xiv) Trainer’s/teacher’s high expectations from learners, and openness to examine
own needs.
xv) Trainer’s/teacher’s competence.

2) Pre-training Work
Unless attention is paid to the following pre-training work, training cannot succeed in
developing people, groups, and organisations: proper identification of training needs;
developing a strategy of development of people through training, including the
rationale and criteria of who (which role occupants) should be sent for training, how
many at a time and, in what sequence; the process of helping people to volunteer, and
the departments to ask for training; pre-training workshop in some cases to raise the
level of motivation of participants and finalise the curriculum; building expectations
of prospective participants from training, etc.

3) Post-training Work
Equally important is what is done after the training is over. The training section needs
to help the concerned managers to plan to utilise the participants’ training, and
provide the needed support to them. Post-training work helps in building linkages
between the training section and the line departments. Follow-up work by the training
section is critical.
3 6

4) Expanding the Training Concept Training

The concept of training has to be widened and training should include not only
programmes involving face-to-face classroom work, but should also include other
ways of providing information and giving necessary skills to people in an
organisation. In fact, getting people together in a group for giving information which
can be given in some other form is a waste of resources. Moreover, the organisation
cannot afford to provide the necessary information and skills on all aspects to all those
who need it, by using the classroom model of training. Self-instructional packages and
manuals of various kinds can be very rich and useful resources of training, even
without collecting people at one site. For example, all those who join the organisation
should know about the budgetary processes and the concept of transfer price. If a self-
instructional book is prepared on this subject, this can be given to anyone who joins
the organisation so that he gets familiar with this concept and can understand the
whole process of all the negotiations taking place in the company. It may, therefore, be
recommended that a list of areas in which such self-instructional material can be
prepared should be developed. This may include the new sales tax rules, new
environmental changes, basic financial problems, calculating contribution, etc.
Similarly, manuals of simple office procedures, leave rules, various personnel
practices, etc., may also be prepared. However, the immediate superior officer may
help the employees by calling them for dialogue and further clarifications after the
employees have learnt through such self-instructional books.

5) Preparation of Training Materials
There is a great need to develop more training materials. Unfortunately, most of the
training programmes use only the lecture method. While the lecture method itself
needs improvement through use of small group discussions, etc., new training
materials need to be developed. These will include simulation exercises and games,
role play cases and material, cases and incidents, practical work manuals, tests and
instruments, and self-instructional materials. Preparation of such material involves
large investment of money, time and energy. But it is still worthwhile, and will have
much higher pay-off than the cost of the investment. In some cases an organisation
can get help from outside experts in the preparation of such material, especially
simulation exercises and games, role plays, cases, and self-instructional material.

13.9 THE PRESENT STATUS OF TRAINING
Training is not fulfilling its proper role in various organisations. There are, at least,
the following five reasons for the plight in which training is at present.

1) Call-girl Role
The training unit organises training events on the initiation or suggestion of the
persons who matter in the organisation. Training plays a reactive rather than a
proactive role. Instead of being a partner in the process of development of the
organisation, it merely responds to requests made to it. This essentially reduces its
effectiveness. This plight is largely shared by the outside consultants and trainers who
are invited to do a particular training programme, or even to give one or more talks on
specific topics. But this is also true of the in-company training function. While talking
to persons in charge of training in various organisations, one gets the impression that
they do not have enough opportunity in the organisation to innovate and suggest ways
of developing it.
So far training has been treated either as a feudal wife or as a call-girl rather than a
modern housewife. The role of the wife in the feudal society was to decorate the home
and bear children, but not necessarily be a life partner in enjoying life, or sharing 3 7

Human Resource problems. A call-girl is invited when she is needed and she also does not participate in
Development the vital decisions of a man’s life. Similarly, taking either analogy, training is not able
to fulfil the obligation of being really effective in an organisation. Training has to
become comparable to a real housewife, by not only responding to the needs of the
organisation, but by determining these needs and being a partner in the process of
development. Unless training is treated as a partner in decision making, it cannot play
the role of contributing to organisational effectiveness.

2) Expectancy of Peripherality
By and large there seems to be a general feeling in the organisation that training is a
peripheral activity rather than a central one. In many organisations training is more
decorative than functional. Some organisations start a training department in order to
look modern, while in some organisations training performs the role of the family
priest. This role is enjoyed by the training sub-system also. The family priest mainly
helps in the performance of religious rituals appropriate to the caste of the family. He
also gives pious advice, often to be merely heard and not necessarily acted upon. He,
however, is not involved in any vital decisions taken by the family. Training therefore
is often regarded as a useful but not a very essential activity in the organisation. Other
functions such as production, marketing, personnel, and finance are very central and
important, and compared to these functions training is only of secondary importance.
This concept of training as a non-essential or a peripheral activity produces several
effects in the organisation. It produces a different sense of priority for training in the
organisation. The personnel connected with the training activity have a low self-image,
and cannot operate with confidence.

3) Low Status
Since training is regarded as peripheral, and since it is treated as a service department,
only responding to the various demands of the organisation, it is unfortunately given
rather a low status. This is a vicious circle. No activity can become central in an
organisation unless the organisation expects that activity to be important and gives it
high enough status. On the other hand, the status is also a function of the activity
being central. The low status of training is reflected in the level at which the TM is
being recruited in the organisation. In most organisations he is at such a low level that
it becomes difficult for to him assert himself and to be heard with respect.
Unfortunately, in Indian organisations status and grade play an important part in
deciding how much say a person would have in the organisation. Low status of
training, therefore, limits its effectiveness considerably.

4) Non-professional Image
Training is becoming a profession. Although it has not been completely
professionalised, it has developed its own techniques, and is fast emerging as a
profession. However, organisations in India still do not treat training as a profession;
in fact, they do not take it seriously. Training is seen as a function which can be
managed by anyone who is good in the main activity of the organisation. As a result,
people appointed to manage training may not have the necessary professional skills
which TMs would be required to have. In some cases those who are found to be less
efficient and effective in other functions are transferred to the training function. Such
practices reflect the attitude of the management towards training. The example is cited
of one organisation in which the training system is fairly large. Discussions with
persons in various parts of the organisation revealed that they were recommending or
nominating those persons for appointment as trainers whom they did not
find very useful. In some cases the transfers of people to the training units and
back to operations were very frequent. Those who were not trainers were not given
3 8 any orientation or training before being made to take up their new roles as trainers.

5) Slow Professionalisation Training

One factor for which we, those who are in the field of training, are responsible is the
slow speed with which we are professionalising training in India. Each profession has
its own system of preparation of those persons who want to join it. It develops its own
skills of working, its own techniques, and its own standards of ethics. It develops a
strong pressure group to ensure that the minimum standards of pre-professional and
in-professional training are maintained. The establishment of the Indian Institute of
Management and the Indian Society for Training and Development has helped in
developing training as a profession. However, the aspirations of training personnel are
so low, and their behaviour so different, that they project a weak image of training.
They only respond to the needs of the organisation, rather than thinking of ways of
transforming their role into a more central one. We need to do a great deal in
developing training as a profession.
Because of these and some other factors the role of training has remained rather
peripheral. It is necessary that it is transformed into a more active and effective tool
for helping the organisation solve some of its problems. Training has to become more
proactive.
Training can play a more effective role in the organisation if it is regarded as one
intervention in a larger context in which several interventions precede or follow it.
Training can either be expanded or formally transformed into organisational
development. Even without such transformation training can begin to play a more
proactive role. We suggest at least two such important roles: Firstly, training
personnel can educate the top management through a series of systematic feedback
from the data generated during the training programmes, as successfully done by one
organisation. The top management in that organisation have increasingly asked for
more advanced programmes for their own education. Secondly, training can be
used as an entry point for further organisational work. For example, one
organisation hired consultants for a specific programme of achievement-motivation
training. After the first programme, the consultants had discussions on their
understanding of the problems, and recommended to the top management to
look into the various other aspects of the organisation. As a result of this
discussion, the top management agreed for a more systematic work of diagnosis and
a possible OD effort.
Such a proactive role requires authenticity on the part of the trainers and
consultants. If they feel that some intervention other than training may be
more useful, it may be helpful to have a dialogue with the management. One of
their roles is to confront the senior management with the understanding of the
problem and help it to be aware of a variety of interventions for the solution of
problems. Training can be a good diagnostic tool also-the first step in a strategy of
organisational change.
Training, like any other activity in an organisation, is meant to help in the
achievement of the organisational goals. The organisation evaluates the various
inputs in terms of cost-benefit ratio. It may be useful for the training unit to
increasingly develop evaluation systems in cost-benefit terms. It should be possible to
show how training is helping the organisation in reducing various kinds of wastage.
Such an evaluation of training in hardware terms will increase its credibility and
boost its self-image.
Training has to be professionalised at a faster rate. One of the skills that we lack is the
use of rich data generated during training and collected in the follow-up work. To
make training an effective intervention or organisational change, the development of
skills of collecting and meaningfully using relevant data for decision making and for
recording the experience for possible sharing with others is very essential. 3 9

Human Resource The increasing professionalisation should reflect in the training of the personnel of the
Development OD units in various kinds of skills, such as organisational diagnosis, problem solving,
innovation for organisational change, data collection, data processing and interpreting
the data, etc. In fact, research should be functional for facilitating organisational
change and these skills are necessary for the successful implementation of the
programme of organisational development.
It may be useful to take help from some agencies for developing such skills.
In order to utilise the rare skills in these areas, some agencies should be
persuaded to undertake the responsibility of developing strategies of and
providing help in data collection, interpretation and feedback for organisational
development. All organisations, however, need not have this kind of expertise.
One or a few organisations can coordinate and provide this kind of expert help.
For example, some institutions can develop a survey and data feedback centre,
providing these services at reasonable cost. It can make available meticulously
standardised devices for diagnosis and organisational survey, and can analyse data and
provide confidential reports on the various aspects of organisational health and
effectiveness. Such a centre can serve the Indian organisations in publishing
consolidated annual reports on general trends in the country, according to various
types of organisations.
The suggestions of transformation of training into organisational development, may
imply elitism in training. While we may plead for this transformation, it is equally
important that the strategy for supervisory and operational training is streamlined.
Such training also needs a wider perspective; attention to the method of receiving and
inducting the new employees in the organisation; determining technical and
behavioural needs for their effective role performance; ways of enhancing teamwork
and inter role support; variety of training inputs and their sequencing to meet the
training needs; and evaluation and follow-up plans, including ways of building post-
training support for achieving training goals.

13.10 MAKING TRAINING A STRATEGIC FUNCTION
Turnaround in thinking on training is already evident - that it must move from
periphery to the centre, from being a service function to partnership in the main task
of the organisation. In a recent study of HR reiengineering at 34 large US companies
69% respondents mentioned “repositioning of HR as a strategic business partner with
the management” as a re-engineering goal. The same is true of training.
Training is concerned with increasing organisational effectiveness. So far the
approach of training has been to offer/organise training for specific competencies.
The movement is in the direction of training becoming more proactive, and contribute
to strategic thinking of the organisation. This swing is sometime seen as abandoning
the previous position and taking a new one. Repositioning does not mean taking an
“either or” position. Repositioning involves expanding the role and emphasising the
strategic role, of training. While the strategic role is important, the other roles are not
to be neglected.
Training should attend both to the current as well as the future needs. The current
perspective is more operational, while the futuristic perspectiveis strategic. The other
dimension relevant for the role of training is that of content vs process. While the
former emphasises the development of specific competencies, the latter is concerned
with developing learning and empowering capability. If we combine these two
dimensions, we get four training modes as shown in Exhibit 2.

4 0

Exhibit 2 : Training Modes Training

PERSPECTIVE

OPERATIONAL STRATEGIC

CONTENT TRAINING RESEARCH

Concerns

PROCESS CONSULTING CHANGE MANAGEMENT

All the four modes of training are important. However, increasingly training must
move towards transformational and strategic roles. Exhibit 3 shows the foci,
objectives, and postures, for these four training modes. We shall briefly discuss these,
taking the four main roles of training.

Exhibit 3 : Training Modes in Details

Training Research
Focus Current Role Multiple Roles
Content Objective Role Effectiveness Org. Effectiveness
Posture Implement Provide input
Concern
Consulting Change Management
Focus Teams Leadership
Process Objective Synergy (Team Building) Transformation
Posture Help Partner

Training Role: Training system should develop needed competencies for various role
occupant. The emphasis is on making the current roles in the organisation more
effective by equipping people occupying these roles with the needed competencies.
Training takes current strategy and implements it in terms of development of needed
competencies. The trainers should deliver good training. And to do this they
themselves must have the relevant technical competencies.
Research Role: In order to move in the strategic direction, trainers need to search
what competencies are needed and will be needed in the organisation. Training then
assumes two more functions: searching future competencies, and developing them.
Since the narrow boundaries of roles are breaking down, a person should develop
flexibility to perform various roles. Multi-skilled workers is a good example of such
effort. This becomes the first essential step for developing autonomous work groups
and self-managed teams. The trainers, who function as researchers, need to develop
their deep insight into organisational needs and process. Trainers should develop
research competencies, especially those of action research.
Consulting Role: Greater emphasis on organisational effectiveness, rather than only
on individual role effectiveness, will require more group process-orientation of
trainers. Development of effective teams influence both the effectiveness of the
individual team members as well as organisational effectiveness. The emphasis is
synergy building, thereby enhancing effectiveness of each member. This can be done
if the trainers advance with their research competencies into a consulting role
4 1

Human Resource analyse problems, develop and use interventions involving concerned line people to
Development deal with the problems, help in implementing the agreed action plan, and support it to
stabilise the decisions. This is one step further in contributing to the strategic process.
Training is then seen as a useful function for developing organisational strategy.
Trainers should develop both sharper understanding of the organisational strategy,
and consulting competencies to play this role effectively. Training function
should be used more frequently for international consulting. Trainers then will also
develop more hand-on experience, which will make training more realistic and
relevant.
Change Management Role: This is the real strategic partnership role. The focus of
training is to develop leadership at all levels in the organisation - the ability of
strategic thinking, taking responsibility, creativity to find alternative solutions, and
empowering others. The objective is to transform the organisation, to make paradigm
shift if needed. Training then becomes a true strategic partner. This is not possible
without involvement of the trainers in the main business of the organisation, and
gaining relevant business knowledge.

Translating Business Strategy into Training Terms
Successful implementation of the business strategy of an organisation will require
some competencies. Business strategy indicates the broad direction for the future
movement of an organisation, and preferred ways of doing so. for successful
implementation, the organisational tasks must be translated into various functional
terms: marketing, financial, technology, human resources, training etc. This helps to
make strategy formulation and implementation participative.
The overall organisational or “business” strategy should provide the framework for
developing the training strategy to facilitate effective implementation of the strategy.
It will include detailed approach to be adopted, competencies to be developed (in
what thrust, evaluation etc. Training strategy thus prepared may be reviewed by all
the functional leaders preparing the strategies which must be integrated into the main
strategy for better synergy.
Another way to translate business strategy into training terms may be to develop
strategies for key decisions taken by the organisation. For example, if cost
reduction is one of the elements in the business strategy, training may develop
ways of advancing this concern and achieving concrete results. In a study of
34 large US companies, for example, 78% HR professionals listed “cost
reduction” as a top goal.
Training goals get closely linked with business goals. By maintaining an independent
strategy, training may send a signal that is not connected with the other functions.
Regarding HR, one participant in the study said “If I had to do it again, I’d build HR
strategies directly into business strategies and make them seamless”.

Working More Closely with Line Managers
People dealing with training should work more closely with line people. They are
already working with line people in the areas of coaching, counseling, training,
strategy planning for the departments etc. When cross-functional task forces and
implementation teams are set up, training people should join these. Similarly, when
teams are set up to discuss training issues etc., line people should be invited as
members. Such close working together may help in integrating training with the
various business groups, and making training a strategic partner.
Rosow and Zager have made some recommendations to forge stronger links between
training and business strategy (Exhibits 4 and 5)
4 2

The partnership in training should be based on value-added partnership of the trainers Training
and training system. As strategic partners training people should raise serious
discussion on how organisational strategy should be developed, and how it can
implemented faster. Effective partnership comes out of professional competence and
credibility.

Exhibit 4 : Making Training a Strategic Partner
1) The vice-president responsible for the training function should be actively
involved in formulating corporate strategy, to ensure that:
l Strategic goals are realistically ambitious with respect to the reservoir of
skills that will be available to meet them
l The training function will be able to help top management communicate
corporate strategy throughout the organisation and to help managers
translate the strategy into training needs.
2) The vice -president for the training function should ensure that all training
programs (1) are necessary to the corporate strategy; (2) are recommended by
(and, if possible, budgeted to) the managers whose employees are to be trained;
and (3) help the trainees progress along the career paths jointly set by them and
their managers.
3) The effectiveness of a program should be measured by how fully and how
durably the trainees have mastered the subject matter.
4) The most controversial-and potentially the largest-factor in measuring the cost of
a program is whether the trainee’s time spent in training should be considered a
cost. Since training (assuming that its objectives are strategically necessary) is
an essential part of every job, we recommend that it not be considered an added
cost. On the other hand, management should count as a cost any additional
expense incurred to cover the trainee’s work while training is in progress.
5) When an employer invites an employee to be retrained, it should ensure that the
employee becomes fully acquainted, as early as possible, with the new position,
work unit, and supervisor, whether the position is within or outside the firm.
Such acquaintance maximizes the trainee’s ability to learn and to apply the new
skills.

Exhibit 5 : Aligning Training strategy with Corporate Strategy
1) The Chief executive officer (CEO) and senior associates should include a
training plan as a critical component of the corporate strategic plan, to ensure
that all levels of the organisation will have the knowledge and skills to carry out
the strategic plan. The training plan should distinguish clearly between (1)
tactical programs designed to meet current needs, and (2) strategic programs
designed to keep up with - and even anticipate-changes in technology,
competition, and work-force standards, as well as with the rapid obsolescence of
occupations.
2) The CEO should regularly monitor the training function to ascertain that (1)
program priorities match those of the corporate strategy, (2) program cost and
skill objectives are valid, and (3) program cost and skill objectives are met.
3) Employers should think of their organisations as, in a sense, institutions for
continuous learning, and should make them function as such. They should,
therefore, aim to involve all employees in all stages of training, from needs
analysis through evaluation.
4) Where employees are presented by unions, employers should invite the unions
to share in the design and administration of training for their members. Unions 4 3

Human Resource should press for and accept such joint programs, but they should be careful to
Development take on responsibility no faster than they acquire the skills and experience to
discharge it.
5) To institutionalize continuous learning throughout the organisation, the employer
should encourage employees to make special efforts to learn - and/or to help
other employees learn - skills valuable to the employer. Encouragement should
take such forms as:
l A clear declaration that continuous learning and helping other employees to
learn are integral parts of every job and every employee’s responsibility.
l Favorable structures and mechanisms, for example, learning by objectives,
train-the-trainer programs, continuous learning centres, semiautonomous
work teams
l Appropriate rewards, for example pay raises, eligibility for promotion,
recognition by peers
l Where a union is present, a jointly administered training program and fund
l Training, with focus of competency building amongst various organisational
units, requires collaboration amongst several players in the organisation.
Partnering by different key persons in the organisation is important for the
success of training.
As Sloman (1996) says “If training in the organisation is to become more effective,
action will be required from trainers, academics, business schools, consultants and
Government. While external agencies like management institutions, academics,
consultants and the government are important for making training effective, the more
critical role has to be played by the internal people in the organisations”. Exhibit 6
summarises the various roles of external agencies as suggested by Sloman (1996).

Exhibit 6 : Ways of Enhancing the Training Function
The role of the training function would be enhanced if

TRAINERS
l developed their own clear model of the role in their own organisation and
communicated it accordingly
l participated in appropriate networks to keep abreast of the debate on the
changing nature of the function

ACADEMICS, BUSINESS SCHOOLS AND CONSULTANTS
l recognised that the place of training in most organisations does not correspond
to best practice, and developed models accordingly
l concentrated efforts on the need to produce practical instruments for translating
an organisation’s strategic policy into human resource terms.

GOVERNMENT
l recognised the limitations of public statements on the importance of training
l introduced fiscal measures designed to ensure that employers invest at least a
specified amount in the training of their workforce.

In Exhibits 7 and 8 are reproduced several recommendations from Rosow and Zager
(1988) for aligning training with technology strategy and with financial strategy
respectively.
4 4

Exhibit 7 : Aligning Training with Technology Strategy Training

1) The manufacturer of new technology should, in its own self-interest, take
responsibility for ensuring that the user becomes capable of operating the new
technology profitably.
2. Such a relationship is advantageous to the manufacturer because (1) it binds the
user to the manufacturer in goodwill; (2) it gives the manufacturer a competitive
edge in acquiring marketable innovations and adaptations developed by the user;
(3) it helps the manufacturer develop improvements in current technology and
designs for newer technology; and (4) it minimizes the possibility of user
disappointment, which acts as a drag on sales.
3) Since formal training is an indispensable part of implementing new technology,
manufacturer and user should jointly develop a training strategy that will ensure
profitable operation by the user. The manufacturer should act either directly or
through a third party for whose performance it accepts responsibility.
4) The manufacturer should adopt a formal business plan that establishes the
function of user training as a critical element of long-term business survival
and growth.
5) Training needs and costs should be included as an explicit part of the investment
in new technology. Hopes of accomplishing training cheaply and by
improvisation are doomed to failure.
6) Manufacturer and user should jointly secure that the user’s employees learn not
only the technical aspects of operating, troubleshooting, and maintaining a
system, but also the scientific and technological principles on which it is based.
This will enable the user’s employees to solve problems on equipment of all
kinds.
7) Manufacturer and user should pay early attention to how the new technology will
affect organisation, decision-making patterns, work rules, job design,
communications, and learning systems. These issues require advance planning
and may determine the success of the organisation. Ad hoc or ex post facto
decisions are often too little, too late, and too costly.
8) When an integrated system is assembled from components supplied by
multiple vendors, the user should seek the assistance of an organisation whose
expertise encompasses both training and most or all of the technologies involved.

Exhibit 8 : Aligning Training with Financial Strategy
1) Senior management should require training proposals to include clear-cut
information related to cost-effectiveness, including need, objectives, content,
design, and delivery. Costs should be related to subject matter and performance-
involvement goals. Comparative cost data should be required whenever possible.
2) Senior management should evaluate cost-effectiveness in terms of agreed-upon
objectives - specifically whether the functional elements are shaped and
combined in the manner best suited to the organisation’s needs. The key
elements include project management, use of in-house versus outside talent,
instructional design, course development, and delivery systems.
3) Employers should give serious consideration to the continuous learning/
employment security connection as a strategy for the long-term survival and
growth of the enterprise.
4) Employers should give as broad a guarantee of employment security as they can
manage, to strengthen work-force receptivity to the continuous change and
continuous learning that competition demands. At the least, they should
guarantee that no program for introducing new technology into the workplace 4 5
will cause employees to lose employment or income.

Human Resource 5) Employers should evaluate the costs of retraining career employees as
Development compared with the visible and hidden costs of separation and replacement with
the new, trained outsiders. Often the costs of retraining (combined with the
advantage of stability of the work force) may be lower, and the costs of
dismissal or retirement and the hiring of new people may be higher, than
appears on the surface.
6) To promote employment security, which is key to high productivity, employers
should assign responsibilities and establish routines to (1) anticipate the
obsolescence of current jobs and the emergence of new jobs, (2) identify current
employees who can be advantageously retrained for the emerging jobs, (3)
provide employees with early opportunities to volunteer for education and
training, and (4) ensure that employees are ready to enter the new jobs when
needed. Where there is a union, it should be involved in these activities insofar
as they apply to employees in the bargaining unit.
7) Employers should anticipate unavoidable displacements or forced dismissals as
far ahead as possible and use the lead time to develop market-oriented re-training
and outplacement programs. Economic supports should be built into the
programs to reinforce employment security.

13.11 TOWARDS LEARNING ORGANISATION
Organisation-wide learning, widespread and as a clear concept, dates only from the
1970s, and that learning had to be continuous only from the 1980s. Continuous
learning that also embraces the environment—the organization-in-its-environment—
has been the top agenda since the 1990s.
The organisation-wide learning view is already a long way from viewing training as
something for individuals, or a class, or a team at work or play. The next step
however, and each step after, does not follow at all smoothly. Each calls for
reconceiving the change effort and so also the training for it. The very next step makes
occasional into permanent effort, and this can usually not be done with merely
stretching what is already there but often calls for programming, resources, and
integration of a different order, and reorganisation. The next step again then broadens
the perspective beyond the organisation to include people outside, and not just as
clients, suppliers, or more or less distant regulators or other officials as before and
one-by-one, but as essential partners and together.
Turbulence, newly and reluctantly recognised as the now normal state of the
environment and fed by instantaneous global information and tremors of all kinds,
causes the shift to a continuously learning organisation. It is a basic shift, to a
different disposition for the organisation as a whole. It orients and prepares the
organisation differently, different even from the recent past when its people expected
and then also buckled down to making a learning effort from time-to-time and here
and there in the organisation, and even when lately that exigency occurred ever more
frequently. So the shift is not just for more economy of effort and smoothing out
interruptions of normal living and working.
Urgent as it is, understanding this move, from spasmodic organisation-wide learning
to a continuously learning organisation is essential, and can be achieved by
collaborative effort. Exhibits and extracts from major works may serve best for an
overview and also for connecting readers with the works themselves for fuller
exposition of views of special interest to them.
Exhibit 9 contrasts organisational learning with a continuously learning organisation
on the six dimensions highlighted in organisational studies since the 1970s. What
4 6 Chris Argyris calls ‘double-loop learning’ sets the stage for the rest: not only is

something learned that improves task performance (single-loop learning), but the Training
organisation too takes note and modifies its policies, structure, ways of
operating, and whatever else is necessary to support that change and to promote
further changes. In both cases, learning only registers when it shows in improved
performance.
The key difference lies in the scope of that performance: in single-loop learning, even
if it be organisation-wide, the organisational framework remains unchanged; in
double-loop learning, the organisation uses the learning for changing its framework as
well. Indeed, when that becomes its culture, it expects and is continuously prepared
for using innovative inputs for improving performance directly and also improving
itself. Basic to this shift is what Harold Bridger, a founder member of the Tavistock
Institute in London, calls the ‘double-task’: learning for improved performance plus
learning how the improvement is effected, for use next time and also to guide adjusting
the framework so it can support further learning.

Exhibit 9 : Organisation-wide Learning and Learning Organisations
Organisation- The Learning
Wide learning Organisation
1) Single-loop learning Double-loop learning (Argyris, 1977)
2) Incremental Transformational (Argyris and Schon, 1978)
3) Lower-level Higher-level (Fiol and Lyles, 1985)
4) Adaptive Generative (Senge, 1990)
5) Tactical Strategic (Dodgson, 1991)
6) Occasional Continuous
Training needs to be re-oriented so that it become a strategic function, and contributes
notonly to the development of individuals and teams, but is able to help the
organization become a learning organization. Training, therefore, deserves rethinking
and replanning.

13.12 SUMMARY
To sum up, training is the act of increasing the knowledge and skill of an employee for
doing a particular job. Training is required in every organisation so as to cope the
employees with the emerging trends. There are various methods of training as
discussed in this unit. Depending upon the training need analysis, a particular method
of training is chosen for the employee(s). Nowadays training has almost become a
strategic function of an organisation. Evaluation of training is as important as
execution of training and the concept of retraining is based on this.

1) Define training and discuss its importance.
2) How training needs are identified in an organisation?
3) Describe the methods of on-the-job training.
4) Explain the concept of organisational learning with examples.

4 7

Human Resource
Development 13.14 FURTHER READINGS
Ralf P. Lynton and Pareek, V. (2000). Training for Organisational Transformation,
Sage Publications, New Delhi.
Sloman, M. (1996). A Handook of Training Strategy, Jaico, Bombay.
Goldstein, I.L. and Ford, J.K. (2002). Training in Organisations: Needs Assessment,
Development and Evaluation, Wordsworth.
Agochiya, D. (2002). Every Trainer’s Handbook, Sage Publications, New Delhi.
Rosow, J.M. and Zager, R. (1988). Training: The Competitive Edge, Jossey Bass,
San Francisco.
Hamblin, A.C. (1974). Evaluation and Control of Training, McGraw Hill, London.
Pareek, V. (1978). “Evaluation of Training”, Vikalpa, Vol. 4, No. 3.
Dasgupta, A. (1974). Business and Management in India, Vishal Publishing House,
Delhi.

4 8

Mentoring and
UNIT 14 MENTORING AND Performance Coaching

PERFORMANCE COACHING
Objectives
l define coaching and mentoring;
l list the goals of performance coaching and mentoring;
l describe the processes of coaching and mentoring; and
l highlight the process of implementing them in organizations.

Structure
14.1 Conditions for Employee Development
14.2 The Objectives of Performance Coaching
14.3 Conditions for Effective Coaching
14.4 The Process of Coaching
14.5 Phases of Performance Coaching
14.6 Making Coaching Effective
14.7 The Process of Mentoring
14.8 Summary

14.1 CONDITIONS FOR EMPLOYEE DEVELOPMENT
For helping an employee to grow and develop in any Organisation, it is necessary to
understand the conditions associated with development. The following are some such
conditions.

1) The individual should be interested in developing himself
Development cannot take place if the person himself is not interested in it. The first
condition for Human Resources Development is to ensure the interest of the individual
in developing himself. Quite often, higher level officers in the organisations write off
some of their employees as not growing or not willing to grow. Such perceptions only
show bias. No individual wants to stagnate. Only others, because of their expectations
and their limited perspectives, brand people as stagnating. This may be because of the
difference between the observer’s interest in the employee’s development in one
direction, being different from the employee’s own desire to learn something else. It is
useful to know in which areas the employee is interested in developing. Through such
an understanding and mutual discussion, it may be possible to create interest in
individuals for new areas of development that are congruent with organisational goals
and plans.

2) The individual should know the areas of his potential development
Although the recent researches in behaviour suggest that individuals can learn any
skills, there is also ample evidence to show that some individuals can grow faster on
some dimensions that on others. These are called aptitudes. While in the developed 4 9

Human Resource countries there are enough opportunities for an individual to know about his potential
Development through psychological tests, school coaching services, family guidance services, etc.,
we do not have such services easily available in India. An individual himself may
discover, quite often too late, that he is good at certain things and he is not as good at
certain other things. A person’s insight into his strengths and weaknesses may depend
on his introspective capability and the opportunities he gets to test himself. In
organisations where fresh graduates are exposed to a variety of jobs through job
rotation procedures, the young men get opportunities to test themselves and their
aptitudes in relation to various functions. In organisations which do not have such a
job rotation policy at the early stages of employee’s career, the chances of round pegs
being put in square holes increase. While every individual should attempt to discover
his own potential, the organisation also has an obligation to create conditions for such
a discovery.

3) The individual should make a clear choice about the direction in which he
would like to grow and develop
Besides discovering his aptitude, the individual should be in a position to make a clear
choice about his career. He might discover that he has more than one strength. A
combination of his strengths may indicate that he is good at a number of things. Some
careers may be more paying than others. Sometimes the individual may have the
strengths required for a particular career, which according to him is rewarding only in
a limited way. In such a case, he should be able to take the risk and create
opportunities for himself to develop strengths required for new careers. Through a
good career planning and training system, the organisation should attempt to help him
to develop himself. The organisation should also help in setting such career goals
realistically.

4) He should be able to identify opportunities for development within and outside
the organisation
Identification of potential, strengths, weaknesses, etc., may have a demoralising effect
on the employees if no system exists for developing or overcoming them.
Opportunities for the development of individual employees within and outside the
organisation should be created.

5) He should identify mechanisms of using these opportunities and get the
support he needs from his superiors and the organisation
While the organisation should plan for the growth of the employees according to their
career plan, it is unrealistic to expect it to support the career goal of each individual
employee. However, it should help the individual to understand the limitations and
work out alternative strategies.

6) He should make efforts to develop
Mere interest in development does not serve any purpose if the individual is not
prepared to invest himself and his energies in his development. Such an investment
would depend upon how much he is prepared to act. Development can take place only
through concentrated efforts to acquire knowledge and the ability to experiment with
that knowledge. High-activity level and risk-taking orientation ‘accelerate learning.

7) He should take outside help to periodically review his progress
Persons cannot develop in isolation. Most of the development at higher levels is
facilitated through human interaction. A person should have either a reference group
or a few selected helpers in the environment for periodical reviews. The reference
group or selected helpers act as mirrors so that the individual can continuously look at
5 0 himself in the direction in which he is growing.

8) A positive emotional and professional climate should be created in the work Mentoring and
place for the employee to progress and review himself Performance Coaching

The responsibility for creating such a climate lies at every level with higher level
officers and the top management of the organisation. Such a climate facilitates free
expression of feelings, emotions, free exchange of views, opinions and, at the same
time fostering of mutual trust.
The identification of potential and development of the employee is a joint
responsibility of the employee himself and the organisation. While the latter should
provide opportunities for the individual to grow, the former should get interested in
identifying opportunities, strengths and weaknesses, set himself realistic career goals,
and continuously review his growth. The individual has the responsibility to make use
of such opportunities and act with drive and determination. One of the most effective
instruments in the hands of an employee for development is performance review
(feedback and coaching).
Performance review can be done at several stages. While it is the responsibility of the
supervisors to guide and counsel their employees in relation to their past, present and
future, a formal system of performance review can be employed by organisations.
Performance review can be done both for the individual and the group.

14.2 THE OBJECTIVES OF PERFORMANCE COACHING
Coaching aims at developing employees in an organization, by the following.
1) Helping them to realise their potential as managers.
2) Helping them to understand themselves – their strengths and weaknesses
3) Providing them opportunity to acquire more insight into their behaviour and
analyse the dynamics of such behaviour.
4) Helping them to have a better understanding of the environment.
5) Increasing their personal and interpersonal effectiveness by giving them feedback
about their behaviour and assisting them in analysing their inter-personal
competence.
6) Encouraging them to set goals for further improvement.
7) Encouraging them to generate alternatives for dealing with various problems.
8) Providing them empathic atmosphere for sharing and discussing tensions,
conflicts, concerns and problems.
9) Helping them to develop various action plans for further improvement.
10) Helping them to review in a non-threatening way their progress in achieving
various objectives.
11) Strengthening the dyadic relationship between the employee and his boss.

a) Individual-level Review
The purpose of performance review is to help the employee grow and develop. Others
can help him as quite often he may not be aware of his own strengths, just as he may
be blind to his weaknesses. Those who continuously interact with the person can act
as mirrors. However, such a feedback should be specific and purposeful. It serves
three main purposes: (1) general improvement of the person, (2) improvement of his
performance in specific tasks, and (3) identification and development of his potential
for higher level responsibilities.
5 1

Human Resource 1. General Improvement : Feedback for the general improvement of an employee is a
Development continuous process. It occurs either inside or outside the organisation through
colleagues, friends, subordinates, family members, etc. Within the organisation,
people who work closely can be instrumental in helping the employee continuously
assess the impact he is making on people and the environment. Such an assessment
would help him to understand his own characteristics and develop as a mature person.
No formal system can help in such a continuous interpersonal feedback. However, it
can be facilitated through an open climate, a climate of psychological security, and
positive attitudes towards one another in the organisation.
2. Improved Performance: While the senior officer help their subordinates to perform
gains. Usually, managers guide their subordinates more in relation to specific,
immediate task-related problems rather than on other aspects of behaviour. For
example, whenever a subordinate faces a problem, his officer may give a solution for
that particular problem. Merely providing the solution to a problem does not amount
to giving feedback. This will not necessarily help the employee to develop the ability
to solve future problems by himself This ability to solve problems by himself can be
developed through continuous education.
The formal appraisal system is another mechanism of giving feedback discussion. In
such a formal system, the tasks are set much in advance. The qualities on which the
individual is going to be rated are also identified in advance. At the end of a specified
period of time, both the individual and his senior officer sit together for performance
review. Feedback is a critical factor in such a review. In the performance review, the
individual points out his own accomplishments in relation to the objectives decided
upon. He may also identify the factors that have helped him in achieving whatever he
could achieve, and the factors that prevented him from doing better. The individual
may also highlight the qualities he has shown in that particular period. After he
presents his own assessment, his senior officer tries to help him analyse his own
performance in greater depth. He might add a number of other factors which have
helped him to achieve whatever he has achieved, and a number of other factors that
prevented him from doing better. The senior officer may also focus on the strengths
and weaknesses of the appraises. He might also point out the consistencies or
inconsistencies of behaviour he observed in the employee. Both the manager and his
employee jointly identify the developmental needs and ways of meeting the needs.
3. Potential Development of the Employee: Employees develop their potential if they
are aware of the opportunities in the organisation and also of the mechanisms for
developing this potential. Some organisations use mechanisms to appraise the
potential of an employee. Usually, data are collected about all the employees whose
potential is being assessed. It may be useful to give feedback to the employee on such
data. Feedback on potential assessment would help the employee to understand his
strengths and weaknesses, and help him to modify his career plans accordingly. If the
employee has no opportunity to explore the feedback further, it is likely to demoralise
him. Since emotions are involved here, it should be handled delicately. Such review
should better be done either by one whom the employee trusts, or by an outside expert
who has used objective measures of assessing the potential, or by a group of people
from the top management who have a broader perspective and who can coach the
employee. The officers one or two levels above the employee can give such feedback,
either formally or informally, after a system of potential appraisal has been introduced
in the organisation. In such a review with the employee, they would have with them
the employee’s ratings and other data on his potential. The following points may be
kept in mind in the potential appraisal review of the employees.
a) The employee should be given the source of feedback;
b) The employee should be told the limits of the feedback;
5 2 c) The employee should be helped to view alternative career opportunities;

d) Before giving such feedback, it should be ensured that the employee believes that Mentoring and
there are opportunities to develop his potential and that human behaviour is Performance Coaching
dynamic and changeable; and
e) While giving the feedback, the relationship of the employee with others who
work with him should also be kept in mind.

b) Feedback to Groups or Teams
Feedback needs to be given to a group of people who constitute a small unit or a
department within a large organisation. It may help the group to grow and develop as
such. Feedback to groups is generally useful in terms of the process mechanisms
operating in the group, like decision-making styles, collaborative orientation of the
group with other groups, delegation, supervisory styles, morale, etc Feedbacks can be
given either by the organisational leader or through an external agent using the
research and surveys. Mechanisms of giving group feedback using survey research are
described in the section on research and organisation development.

14.3 CONDITIONS FOR EFFECTIVE COACHING
Coaching is a means and not an end in itself. Development does not occur just because
there is coaching. Coaching could be an effective instrument in helping people
integrate with their organisations and have a sense of involvement and satisfaction.
The following conditions are necessary for coaching to be effective:

1) General Climate of Openness and Mutuality
If the organisation or department in which the employee is working is full of tension,
and people do not trust each other, coaching cannot be effective. A climate of
minimum trust and openness is essential for effective coaching.

2) General Helpful and Empathic Attitude of Management
Coaching involves effective helping, which is not possible unless the coach has a
general helping attitude and has empathy for the counselled.

3) Uninhibited Participation by the Subordinates in the Review Process
Unless the subordinates in a department or organisation feel free enough to participate
without inhibition in the process of review and feedback, coaching cannot be effective.
Coaching is not a one-way process of communicating to the employee what he should
or should not do. It is a process of developing a dialogue which eventually contributes
to a better understanding on the part of the counsellee.

4) Dialogic Relationship in Goal Setting and Performance Review
Performance coaching focuses on the counsellee’s achievement of the performance
goals set in consultation with his manager. Joint participation by the employee and his
reporting officer is necessary both in goal-setting and performance review. Without
such collaborative effort, coaching cannot achieve its purpose.

5) Focus on Work-oriented Behaviour
The main purpose of performance coaching is to help the employee to improve his
performance. Coaching can be effective if the focus is kept on the work-related goals
rather than on diffusing attention into various other areas. While doing so, discussion
may involve other related and personal issues, but these are used to refocus on
improvement on organisation roles rather than on personal or general personality
problems. 5 3

Human Resource 6) Focus on Work-related Problems and Difficulties
Development
Performance coaching is not only related to the achievement of goals, but also to the
contextual problems in achieving or not achieving the goals. Analysis of performance
therefore becomes the basis of coaching.

7) Avoidance of Discussion of Salary and other Rewards
Performance coaching may not serve its purpose if it includes discussion about salary
raise, rewards, etc. The main purpose of performance coaching is to use performance
appraisal in planning and improvement of the employee, rather than in understanding
the relationship between performance and rewards like salary, etc. Bringing such
discussion in the performance coaching may vitiate the main purpose of coaching.

14.4 THE PROCESS OF COACHING
Coaching is given by one who is senior to the person, receiving the help—in
competence, knowledge, psychological expertise, or in the hierarchical position in an
organisation. There are three main processes involved in coaching—communication,
influencing and helping. The coach essentially communicates with the employee.
Communication involves receiving messages (listening), giving messages
(responding), and giving feedback. The person who provides coaching does all the
three things. Coaching also involves influencing the counsellee in several ways. The
manager cannot deny the fact that he is influencing his employee in such a way that
the latter is able to move in some direction. However, this influence is of a special that
is, enabling the other person to exercise more autonomy, providing positive
reinforcement so that desirable behaviour is further strengthened, and creating
conditions in which the person is able to learn from the behaviour of the coach
through the process of identification. The third element in the process, i.e., helping,
also functions in a similar way. It involves three different elements. Firstly, helping
behaviour is based on the concern and empathy the coach has for his counselee.
Secondly, it is also based on the mutuality of relationship; the counselee responds as
much to the coach’s needs as the latter does to the former’s. Finally, helping primarily
involves identification of developmental needs of the counselee so that he may be able
to develop and increase his effectiveness. This dynamic process of coaching is shown
in Figure 1.
Figure 1 : The Process of Coaching

Responding Empathy
Initiating

Listening Development

Communications Helping

Counselling Mutuality
Feedback

Influencing

Identification Positive
reinforcement
Autonomy
5 4

The various elements of the process is explained in more detail below. Mentoring and
Performance Coaching
1) Communication
Interpersonal communication is the basis of performance review in which both the
employee and his reporting officer are involved. Such a conversation in performance
review should be congenial, which may help the employee to be in a receptive mood. It
is important to keep in mind that communication is greatly influenced by how
problems and issues are perceived by the two persons involved in the conversation. It
may get distorted if people are not empathic to each other and do not try to understand
each others’ point of view. Non-verbal communication is as important as verbal
communication. People speak much more through their gestures and postures than
through words. The tone and manner of speaking is also important. There are three
main elements in communication.
Listening: Listening is the first effective step in communication. Listening involves
paying attention to the various messages being sent by the other person. The obvious
message is the ideas being communicated (cognitive message). But there may be
hidden feelings and concerns which the other person may not be able to put clearly in
words. Listening to feelings and concerns is very important for effective coaching.
This involves skills which can be practised. Some exercises can be used to improve
listening of such hidden messages (Rao and Pareek, 1978).
Asking Questions and Responding: Questions can facilitate or hinder the process of
communication. They can serve several purposes: they can help in getting more
information, establishing mutuality, clarifying matters, stimulating thinking. Questions
play a very important role in coaching. Some questions can shut off the employee, or
make him dependent on the coach, while some others can build the autonomy of the
employee. Obviously, the latter will be helpful, and not the former.
Questions that do not Help: The following types of questions are not only unhelpful,
but they also hinder the process of effective coaching:
a) Critical questions: Questions which are used to criticise, reprimand or doubt the
counsellee, create a gap between him and the counsellor. The way the question is
asked (skeptical or sarcastic tone) may indicate that the question is a critical one.
The choice of words may also indicate the critical nature of the question. “Why
did you fail to achieve your targets?” communicates criticism, whereas “Why
could you not attain your targets?” would normally communicate an invitation to
examine hindering factors. “How did you again fall short of your target?” is a
reprimanding question. “How can you achieve this target since you failed last
time?” indicates doubt in the ability of the employee. All such critical questions
either shut off the counsellee or make him diffident.
b) Testing questions: Questions that are asked to find out whether a person is right
or wrong, or how much he knows, are evaluating or testing questions. Such
questions may tend to put the other person on the defensive. In a testing question,
the person asking the question takes a superior attitude, while the other person is
put in a kind of witness box. Such questions may also take the form of a cross-
examination. A reporting officer who proposes to find out why his employee was
not able to meet his target can easily slip into a cross-examination, testing or
evaluating posture. Again, the tone of the interviewer may determine whether the
question is a testing question. Such questions are sometimes similar to critical
questions.
c) Resenting questions: A person may ask questions to indicate his resentment of
the behaviour of the other person. When an employee in a coaching situation
asks: “How should I attain a higher target?”, it may indicate his resentment
depending on the tone in which such a question is asked.
5 5

Human Resource d) Leading questions: Quite often unknowingly, the questions asked indicate what
Development kind of answers are wanted and such answers are actually received. Such a
question may be asked after making a statement. For example, a reporting officer
may say to his employee: “You could not attain the target because maintenance
department did not cooperate. Is that true?”, or it may be put in the question
form: “Were you not able to attain the target because the maintenance
department did not cooperate?” Both are leading questions. A leading question
almost seduces the other person to go along the line of thinking of the one who
asks the question. This tends to stop further exploration and is not helpful.
Questions that are Helpful: The following types of questions may be of help in
developing a more healthy relationship and in increasing the effectiveness of the other
person.
a) Trusting questions: Questions which are asked to that the questioner is seeking
help or suggestions may indicate the trust he has in the other person. The
question “How do you think I can deal with the problem I am facing?” is seeking
help from the other person. Such questions may be asked both by the employee
and the supervisor.
b) Clarifying questions: Questions may be asked to collect information, more facts
and figures. Such questions are very helpful. If a coach asks his employee
several questions to help him to get more information about various aspects, the
employee, in turn, would provide him with relevant information to understand his
problems. After listening to a person for some time, the coach may paraphrase
the counsellee’s statement (also called mirroring), and then he may ask a question
to confirm whether his understanding is correct. For example, the question, “Are
you worried about your lack of knowledge of the new system?” is a clarifying
question. A clarifying question helps the manager and the employee to remain at
the same level throughout the conversation.
c) Empathic questions: Questions about the feelings of a person, his concern, his
problem, not so much for finding solutions as to indicate and express concern,
may be classified as empathic questions. When a manager asks an employee:
“How is your son feeling now?”, he is not merely seeking information, but in fact
indicating his personal concern about the health of the employee’s son and
thereby expressing empathy with the employee. Such questions help to generate
more trust, and the necessary rapport with the employee. Empathic questions
create a climate of mutual trust and human understanding.
d) Open questions: The most useful questions are those which stimulate reflection
and thinking in the employee. “Why do you think we have not achieved the
targets this year while the other company has?” is an open question inviting the
other person to explore the various possible dimensions, and to share them with
the person who is asking such a question. Open questions encourage creativity,
and a tendency to explore several directions which might have been neglected so
far. Such questions are very useful.
e) Responding to questions: Coaches sometimes use certain responses, some of
which are useful and some dysfunctional. Some coaches may be using certain
types of responses more often than others. It is necessary to be aware of this.
Responses that alienate the employee, criticise him or order him, are more likely
to be dysfunctional. Empathic, supportive, and exploring responses are more
functional. Various verbal behaviours in a coaching situation that characterise
these responses are shown in Exhibit 1.

5 6

Exhibit 1 : Coach Responses Mentoring and
Unhelpful Effective and helpful
Alienating Empathic
Continuous stress on conformity Leveling
Not encouraging creative acts Rapport building
Passive listening Identifying feelings
Lack of verbal response Supportive
Critical Recognising
Criticising Communicating availability
Pointing inconsistencies Committing support
Repeated mention of weaknesses Trusting
Belittling Exploring Questions
Reprimanding Questions
Directive Reflecting
Prescribing Sharing
Ordering Probing
Threatening Closing
Giving no options Summarising
Pointing out only one aceptable way Concluding
Quoting rules and regulations Contracting for follow up and help

Feedback
Interpersonal feedback is an important input for increasing self awareness. It helps in
reducing the blind area of a person, helping him to become more aware about his
strengths and weaknesses. If properly used, it results in a higher mutuality between
two persons. The process of interpersonal feedback, and conditions which make it
effective, have been discussed in detail (Pareek, 1976). The following hints are
reproduced from that source:
Feedback will be effective if the person giving feedback (coach) makes sure that it is:
1. descriptive and not evaluative;
2. focused on the behaviour of the person and not on the person himself;
3. data-based and specific and not impressionistic;
4. reinforces positive new behaviour;
5. suggestive and not prescriptive;
6. continuous;
7. mostly personal, giving data from one’s own experience;
8. need-based and solicited;
9. intended to help;
10. focused on modifiable behaviour;
11. satisfying the needs of both (giver and receiver of feedback)
12. checked and verified;
13. well timed; and
14. contributes to mutuality and building up of relationship.
From the point of view of the one who receives the feedback, it is necessary that the
reaction to feedback is more in terms of exploring ways of improving behaviour rather
5 7

Human Resource than of defensive behaviour. The following defensive behaviour might not help in
Development using feedback properly; the behaviour which are opposite of these may be helpful.
1) Denying feedback as opposed to owning up responsibility for behaviour.
2) Rationalisation (explaining away feedback by giving reasons) as opposed
to self-analysis to find why such behaviour was shown.
3) Projection (contributing negative feelings to the other persons) as opposed to
empathy (trying to understand the point of view of the other persons).
4) Displacement (expressing negative feelings to one who may not fight back) as
opposed to exploration (taking help of the other person in knowing more about
the feedback given).
5) Quick acceptance without exploration as opposed to collecting more information
and data to understand the behaviour.
6) Aggression towards the person giving feedback as opposed to seeking his help in
understanding the feedback.
7) Humour and wit as opposed to concern for improvement.
8) Counterdependence (rejecting the authority) as opposed to listening carefully to
the person giving feedback.
9) Cynicism (generally strong skepticism that things cannot improve) as opposed to
a positive, critical attitude to accept some feedback and to question some other.
10) Generalisation (explaining things in a general way) as opposed to experimenting.

2) Influencing
Influencing would mean making an impact on the person in relationship. Such impact
need not necessarily be of a restrictive type. Influencing in coaching would involve the
following three aspects:
a) Increasing Autonomy of the Person Usually, influencing is understood only in the
sense of restricting the autonomy of the person and directing him into channels which
are predetermined by the person exerting influence. Positive influencing is the opposite
of this; the autonomy of the other person is increased, and he has larger scope of
making his own choice. Even this is influencing, but of a different kind. Flanders
makes a distinction between the two modes of influence, viz., the direct mode of
influence (which restricts the freedom of the other person), and the indirect mode of
influence (which increases the freedom of the other person). Flanders has developed
some categories to indicate the two modes. He classifies criticism and punishment in
the first category, and encouraging a person in the second category of influence. The
reason is obvious. When a person is criticised or punished, some actions for which he
is criticised or punished are inhibited and the person avoids doing those in future. This
restricts his freedom. On the other hand, if a person is praised or recognised, he feels
encouraged to take more initiative in exploring new directions. This results in an
increase in the field of his autonomy. In coaching, much more use is made of the
indirect mode of influence, by recognising and expressing feelings, acknowledging and
praising good ideas given by the counsellee, and raising questions which promote
thinking and exploration.
b) Positive Reinforcement: It has been established by Skinner that change in
behaviour cannot be brought about in human beings through punishment or
negative reinforcement, but only through positive reinforcement. Influencing would
involve providing encouragement and reinforcing success so that the person takes
more initiative and is able to experiment with new ideas. Change cannot take place
without experiment and risk taking. And these are encouraged through positive
reinforcement.
5 8

c) Identification: One major influence which helps an employee to develop is the Mentoring and
opportunity for him to identify himself with individuals having more experience, skill Performance Coaching
and influence. This is the first stage in the development of psycho-social maturity, or
power motivation. This legitimate need should be fulfilled. Levinson states several
barriers which may come in the way of such a legitimate process of identification: lack
of time, intolerance for mistakes, complete rejection of dependency needs, repression
of rivalry, and unexamined relationship. Levinson suggests that, to help the
development of the process of identification it is necessary that the manager also
examines his own process, and needs of interacting with the subordinates.

3) Helping
Coaching is essentially helping. Helping involves several processes but the following
three are mainly important.
a) Concern and Empathy: Without the manager’s concern for his employee, effective
helping cannot be provided in a coaching session. Such concern is shown when the
coach is able to feel for his subordinate and is able to empathise with him. This would
be reflected in the kinds of questions asked and the tone in which the conversation
takes place. Managers may constantly ask themselves how much concern and genuine
empathy they have for the employees they are coaching. Without such genuine
concern, coaching may only degenerate into a ritual and cannot achieve its goals.
b) Mutuality of Relationship: Coaching should not be regarded as merely giving help.
It is also receiving help on various aspects. Unless such a relationship is established—
i.e., both persons involved in the relationship feeling free to ask for and provide help
to each other—coaching cannot be effective. Mutuality is based on trust and the
genuine perception that each person has enough to contribute. Although the
coach is in a superior position, he continues to learn and to receive help from
the counsellee.
c) Identifying Developmental Needs: The main purpose of performance coaching is to
identify the development needs of the employee which can be met through various
ways. It is necessary that coaching results in clear and systematic identification of
such needs and in subsequent plans as to how these needs will be fulfilled.
Sperry and Hess (1974) have advocated the use of contact coaching, which they
defined as “ the process by which the manager aids the employee in effective problem-
solving, and develop using the techniques or keying, responding and guiding.” Contact
coaching is based on a transactional analysis approach and makes use of several skills
already discussed. Keying refers to reading people. The supervisor uses an
appropriate frame of reference to perceive what the employee means by his verbal and
non-verbal responses. Responding concerns what the supervisor communicates back
to the employee. What is learnt from keying is replayed in a manner which adds to, on
subtracts from, the interchanges with the meaning the employee communicates.
Guiding is the techniques the supervisor uses to motivate or help the employee to
change his behaviour. The supervisor as motivator can increase the employee’s drive
and direct it so that he accomplishes his objectives better.
Morrisey (1972) has suggested a few other techniques, such as a you-we technique,
second-hand compliment, advice-request and summary. In the you-we technique, one
uses you to compliment and we to criticise (“you are doing a great job, we have a
problem”). The second-hand compliment is communicating to the subordinate a
compliment for him received from a third party (Mr. Raman says that you have done
an excellent job for him). The advice-request is asking the employee for suggestions
and advice. Summarising at the end helps in clarifying the decisions taken and fixing
the responsibilities and integrating the whole discussions.
5 9

Human Resource Values in the Helping Process: The central issue in a helping process relates to the
Development values of the helper. The helping behaviour and strategies flow out of the basic stand
he takes in relation to the client. Figure 2 gives in summary the dynamics of the
helping process in value terms. The helper should ask himself/herself what values he/
she holds, and with what consequences.
Okun (1976) has suggested that the following set of images of people is essential for
an effective helping process:
1) People are responsible, and capable of making their own choices and decisions.
2) People are controlled to a certain extent by their environment, but they are able
to direct their lives more than they realise. They always have choices and
freedom, along with responsibility, even if they have restricted options due to
environmental variables or inherent biological or personality predispositions.
3) Behaviours are purposive and goal-directed. People are continuously striving
towards meeting their own needs, ranging from basic physiological needs to
abstract self-actualisation ones (fulfilling physiological, psychological and
aesthetic needs).
4) People want to feel good about themselves and continuously need positive
confirmation of their own self-worth from significant persons. They want to feel
and behave congruently, to reduce dissonance between internal and external
realities.
5) People are capable of learning new behaviours and unlearning existing ones and
they are subject to environmental and internal consequences of their behaviours,
which in turn, serve as reinforcements. They strive for reinforcements that are
meaningful and congruent with their personal values and belief systems.
6) People’s personal problems may arise from unfinished business (unresolved
conflicts) stemming from the past (concerning events and relationships) and,
although some exploration of causation may be beneficial in some cases, most
problems can be worked through by focusing on the here and now, on what
choices the person has now. Problems are also caused by incongruence between
internal (how you see things inside) and external (how you see things outside)
perceptions in the present.
7) Many problems experienced by people today are societal or systemic rather than
personal or interpersonal. People are capable of learning to effect choices and
changes within the system as well as from without.

14.5 PHASES OF PERFORMANCE COACHING
Coaching is helping the employee to grow and develop in the organisation. Every
manager is coaching his employee, knowingly or unknowingly, in his day-to-day
work-life. An effective manager coach is one who helps his employees to become more
aware of their strengths and weaknesses and helps them to improve further on the
strong points and overcome weaknesses. By the process of mutuality and support, he
helps the employee to develop, by providing the proper emotional climate. Mutuality
involves working together with the employee and developing future plans of action for
the employee’s growth and contribution to the organisation. Support involves
acceptance of the employee as a total person, with his strengths and weaknesses, and
encouraging him with warmth.
Coaching requires certain interpersonal skills which can be acquired easily if a
manager is genuinely interested in developing his subordinates. Coaching skills are
important for a manager, particularly at the time of performance review.
6 0

Figure 2 : Circular Helping Process – Two Types Mentoring and
TYPE A
Perception of
client as

s
l Ignorant
l Dependence
l Incapable of making
or
rational choices
l Counterdependence
l Irresponsible
s

Perception of the problem, Resulting in
as caused by clients
s

l Ignorance l Tell what to do
l Lack of understancing l Explain
l Lack of capability l Suggest simple solutions
l Inability to act l Advice
l Inability to make make l Give solution, not rationale
rational decisions l Criticise, reprimand
l Weaknesses
s

TYPE B
Perception of
client as
Confirming
s

l Ignorant
l Autonomy
l Capable of rational
or
decisions
l Interdependece
l Responsible
s
Perception of problem Resulting in
as caused by
s

l Outside forces l Analyse (with client) the forces
l Complex factors l Encourage the client to analyse
l Blocks preventing Client the dynamics
to perceive complexity l Encourage the client to identify
l Client’s unfamilianty with the blocks
resources l Encourage the client to develop
referral systems
s

The hilping mode

Good managers, whenever the necessity arises, coach their employees in their jobs.
Annual performance reviews provide formal opportunities for formal coaching. Such
a formal coaching process passes through certain stages, which are important for the
managers to note. The coaching process has the following three phases: rapport
building, exploration, and action planning.
In the rapport-building phase, a good coach attempts to establish a climate of
acceptance, warmth, support, openness and mutuality. He does this by empathising
with the employee and his orientations, by listening to his problems and feelings, by
communicating his understanding to the employee, and by expressing empathy with
and genuineness of interest in him.
6 1

Human Resource In the exploration phase, the coach attempts to help the employee to understand
Development himself and his problem better. He may do this by raising questions to help the
employee explore his problems and diagnose the problem properly.
In the action planning phase, the coach and the employee jointly work out or plan
specific action steps for the development of the latter. The manager makes
commitments to provide the specific support to employee for development.
Exhibit 2 gives the three phases (and the sub-phases) of the coaching process. Against
each sub-phase are mentioned types of coach behaviour which either help or hinder
the coaching process.

Exhibit 2 : Sequential Process of Performance Coaching

Phases Helpful Behaviour Hindering Behaviour
Report Building
Attending Rituals, smile
Conversation on personal matters Discussion from start
Listening (to) Physical attention (posture) Distraction (attending to
other things, telephones etc.)
feelings Eye contact Signing letters, talking to
concerns Response (verbal and non-verbal) others etc.
problems Keeping out telephones, noise, disturbance, etc.
during conversation
Acceptance Communication of feelings and Lack of response
(empathy) concerns Paraphrasing feeling Passive listening for a long
Sharing own experience period
Exploration
Exploring Mirroring or paraphrasing Criticising
Open questions Avoiding or hedging
Encouragement to explore
Problem Questions to explore possible problems Suggestion of a problem
Identification Encouragement to generate information
Identification of a probable problem
Diagnosis Exploratory questions Suggesting the cause
Generating several possible causes
Action Planning
Searching Questions on possible solutions Advising
Generating alternative solutions
Decision making Questions on feasibility, priority Directing
pros and cons Making a fixed plan
Discussion of one solution
Discusssion of an action plan
Contingency plan
Supporting Identification of needed help Promise of general help
Monitoring
Contract on help

Rapport Building
Rapport building is essential for any effective coaching outcome. This phase involves
generating confidence in the employee to open up and frankly share his perceptions,
problems, concerns, feelings, etc. The coach-manager should level himself with his
employee and tune himself to his orientations. This can be done by adopting the
6 2 employee’s frame of reference.

Attending: The opening phase of coaching is very important in rapport building. Mentoring and
General opening rituals may communicate messages of attending to the employee and Performance Coaching
give importance to the coaching transaction. Inviting rituals like offering the chair,
closing the door to indicate privacy, asking the secretary not to disturb or not to
connect telephonic calls during the conversation, may indicate that the coach is
attending to the employee. However, all such rituals should come out of the genuine
concern for and full attention to the employee during the coaching session.
Listening: It has already been discussed that listening is important for effective
coaching. As already stated it is important to listen to what the employee says, as well
as to his feelings and concerns. Physical posture (e.g., leaning forward) and keeping
eye contact with the employee are indicators of listening.
Acceptance: Establishing a climate of acceptance is a necessary part of establishing
rapport. The employee must feel that he is wanted and that his coach is interested in
understanding him as a person rather than as a role or a position in an organisation.
The coach communicates this to the employee by listening to all the problems of the
employee and communicating back to the employee that he is listening. The coach can
communicate back to the employee by paraphrasing or mirroring or reflecting what
the employee says. For example, when an employee says, “I am really mad. I have
tried to do my best in the past year. I have worked twice as hard as anyone else in the
office. But I never get promotion,” he is expressing his anger. The coach may reflect
back and say, “You feel that your superiors have not shown proper recognition for
your hard work.” Such a reflection or mirroring would help the employee feel that he
is being understood and that his coach is interested in him. This builds a climate of
acceptance and facilitates the process.
Exploration: Besides accepting the employee, listening to him, and establishing a
climate of openness, the coach should attempt to understand as well as help the
employee understand his own situation, strengths, weaknesses, problems and needs.
Nobody would like to be directly told his weaknesses. Coaching skill lies in making
the employee discover his own weaknesses, and identify his problem. At the most, the
coach may use open and exploring questions.
Exploring helps an employee to search various dimensions of the problems, or
discover unidentified problems and bring to the surface unnoticed issues. Exploring
can be done by using questions and suggesting to the employee to talk more on a
problem he mentions. As already discussed, a variety of questions may be used.
Problem Identification: After general exploring, questions may be asked to help the
employee focus on the problem. It is necessary for the coach to use questions, both to
generate information on some concerns and problems and to narrow down focus to
identify a more probable problem. For example, if an employee feels that his problem
is that others do not cooperate with him, the coach may ask questions to narrow down
the problem to the employee’s relationship with a few colleagues, and then questions
may be asked to help the employee see what he does that prevents possible
cooperation. Eventually, the problem may turn out as to how the employee may deal
with competitive relationship, and yet collaborate. Identification of a problem is the
necessary step in planning for improvement.
Diagnosis: Diagnosis of the problem is the next step in exploration. Explorations
should lead to the diagnosis. Without diagnosis there is little scope for solving any
problem. Open questions like “Why do you think people are put off when you talk
with them?”, “Can you recall occasions when you got full cooperation?”, “What do
you attribute it to?”, “What personal limitations mainly bother you?” may help the
employee more towards a better diagnosis. The main attempt should be to generate
several alternative causes of a problem.
6 3

Human Resource Action Planning: Managers are expected to guide their employees and contribute to
Development their development. Coaching interviews should end with specific plans of action for
the development of the employee. Identifying a training need, job rotation, sponsoring
for further training, increased responsibility, role clarity, etc., are some of the likely
outcomes in such action plans. Three sub-phases can be identified in action planning.
Searching: The main contribution of the coach to action planning is the help he
provides to the employee in thinking of alternative ways of dealing with a problem. In
addition to encouraging the employee in brain-storming such alternatives, the coach at
a later stage can also add to this list of alternatives for further exploration. This
should, however, be done only after some time. The employee should primarily take
the responsibility of generating alternatives.
Decision Making: After the alternatives have been generated, the coach may help the
employee assess the advantages and disadvantages of each alternative, raise questions
on the feasibility of the various alternatives, and help finalise a plan to be
implemented. This may, however, be regarded as a contingency plan, to be altered in
the light of further experience.

Supporting
The final and, crucial stage of coaching is to communicate support and plan for such
support in implementing the agreed action plan. Psychological contract of providing
help should emerge after considerable exploration and discussion. Support and help
should facilitate in further increasing the autonomy of the employee, and not his
dependence on the coach. A system for monitoring and follow up of the action plan
may be prepared. This closes the coaching interaction.

14.6 MAKING COACHING EFFECTIVE
In performance coaching formally organised by the organisation, the employee may
not ask for coaching but his superior may organise coaching interviews as an
organisational requirement. On such occasions, the employee may be forced into a
coaching situation. If coaching is given without having been sought, it is likely to be
of limited value. It may prove frustrating both to the coach and to the employee. In
such situations, the coach would do well by forgetting about performance coaching
and talk to the employee about his lack of interest in growth. The employee is likely to
open up if the coach establishes an open climate. If the employee has serious
emotional block in dealing with his superior, there is no use organising a coaching
interview. They need a problem-solving session before that. Hence, before coaching, it
must be ensured that the employee is willing to learn from this interview.
Some employees are so loyal and some superiors so protective, that there is a danger
of employees becoming totally dependent on the coach. The coach should check from
time to time through reflection, if he is making the employee too dependent on him.
The coach must allow the employee to make his own decisions and perhaps help him
in making decisions, but must not take decisions for him.
The employee must understand the purpose of coaching. If he does not understand, or
has wrong expectations, he may not receive whatever is said to him in the proper
perspective. If it is felt that he has some misunderstandings, it is better to use the first
session to clarify them and then schedule another session.
Arguments should be minimised. One argument is sufficient to make both parties
defensive. The coach should accept everything the employees says and try to build on
it. Acceptance is the best way of bringing about self-realisation in the person.

6 4 Good coaching sessions fail to produce effective results due to lack of follow up.

Follow ups through informal exchanges go a long way in communicating interest in Mentoring and
the employee. Otherwise, he may feel that the coaching is only artificial and may lose Performance Coaching
interest in it eventually.

14.7 THE PROCESS OF MENTORING
The word “mentor” comes from the Greek epic story about Odysseus who wandered
the world seeking adventure and—you could say—personal development. Before
going on his ten-year voyage (none of this weekend workshop stuff for Odysseus!), he
left his son Telemachus in the care of an older and trusted friend whose name was
Mentor. In Odysseus’ absence, Mentor not only helped the boy become a competent
young man but also saved his life. This relationship, and the name of the older man
who assisted the younger man in developing himself, became a model for what is now
known as mentoring.
Mentoring is the process where a person (the mentor) provides support, training, and
guidance to a less experienced, usually younger person (the mentee, mentoree, or
protege). Some benefits of mentoring are that it enhances productivity and teamwork,
it encourages continued learning, it improves the self-esteem of the protege, and it
improves the chances of success in the protege’s endeavours.
Levinson et al. (1978) have contributed the most to the understanding of the
mentoring process. Levinson’s concept of a mentor includes being a teacher, sponsor,
counsellor, developer of skills and intellect, host, guide, exemplar, and most
importantly supporter and facilitator in the realization of the vision the young person
has about the kind of life he wants as an adult. Mentoring integrates characteristics of
the parent-child relationship and peer support without being either. According to
Levinson not having a mentor in formative years of a young person could be a great
handicap to one’s psychological and career development.
Although young person during their professional journey, unknowingly research and
discover appropriate mentors, organisations are increasingly paying attention to this
phenomenon. Generally, more promising young managers are given mentoring
experience. A young manager assigned to a mentor, who is senior in position and age
sometimes several levels senior to the protege; not necessarily from the protege’s
department. Mentors are selected on the basis of their interest, availability, and
“mentoring competence” (image of competence, empathy, and ability to provide
emotional support). One mentor may have not more than five protege. Tata Iron
successfully used this arrangement.
There are two main phases in mentoring process: dependence and inter-dependence,
although counter-dependence may in some cases be an intermediary phase between
the two. During dependence phase admiration for the mentor is followed by
identification with him, followed by approval (getting guidance and checking
alternative action ideas). The inter-dependence phase is characterised by trust-building
and mutuality when the mentor and the protege may begin to collaborate and provide
emotional support to each other, If the mentor is experienced as overwhelming and
overpowering, counter-dependence may develop before inter-dependence. The protege
may reject the mentor and may develop his own independence. Search of one’s own
identity may later lead to appreciation of the mentor’s role and relationship, leading to
inter-dependence. Several well-known persons in the west having famous mentors
passed through the counter-dependence phase, and some could not make much
progress to inter-dependence.
Mentoring process is quite similar to the counselling process. The dynamics of the
phases discussed with counselling are also applicable to mentoring. The ultimate goal
of both counselling and mentoring is to help an employee attain psychological
6 5
maturity and effectiveness.

Human Resource
Development 14.8 SUMMARY
Performance coaching is important as it helps the employees to realise their potentials,
knowing their weaknesses and to grow and develop. There are few conditions
associated with these developments and also for effective coaching. The process of
coaching involves communication, influencing and helping and there are also phases
of coaching. Mentoring is the process where a person (the mentor) provides support,
training and guidance to a less experienced person. It involves two phases i.e.
dependence and interdependence.

1) Define performance coaching and write its objectives.
2) Describe the process of performance coaching.
3) Discuss the phases of performance coaching with suitable examples.
4) Write a note on the process of mentoring, citing examples.

Morrisey, G.L. (1974). Appraisal and Development through Objectives and Results,
Addison-Wesley.
Sperry, L. and Hess, L.R. (1974). Contact Counselling, Addison-Wesley.
Okum, B.F. (1976). Effective Helping: Interviewing and Counselling Techniques,
Durbury Press.
Pareek, V. and Rao T.V. (2000). Designing and Managing Human Resource System,
Oxford & IBH.
Whitmore, J. (2002). Coaching for Performance, Nicholas Brealey, London.
Burnard, P. (1995). Counselling Skills Training, Viva Books, New Delhi.
Hunt, J.M. and Weintraub, J.R. (2002). The Coaching Manager, Response Books,
New Delhi.
Levinson, D. (1978). The Seasons of a Man’s Life, Knopt.

6 6

Building Roles and Teams
UNIT 15 BUILDING ROLES AND TEAMS
Objectives
After going through this unit, you will be able to:
l distinguish between position and role in a system;
l recognise the significance of role in person -system integration;
l identify role systems;
l define role efficacy and enumerate its different aspects;
l distinguish a team from a group;
l identify different stages of team development;
l list criteria of effectiveness of teams; and
l suggest different ways of team building.

Structure
15.1 The Concept of Role
15.2 Role Systems
15.3 Developing Roles: Roles Efficacy
15.4 The Concept of Team
15.5 Team Development
15.6 Making Teams Effective
15.7 Summary

15.1 THE CONCEPT OF ROLE
In any social system, such as the family, club, religious community, work
organisation, etc., individuals have certain obligations towards the system, which in
turn gives each one of them a defined place in the society. This system of mutual
obligations can be called a role, and the individual’s place a position or an office. For
example, when one joins a new club, one is admitted as a member (that is an office or
a position). One’s position as a member is defined in terms of the hierarchical
placement and privileges (the power one will enjoy). One also agrees to abide by
certain rules, carry out certain activities when required, volunteer for certain work,
etc. The other members of the club expect all this from the individual, and one also
expects to do the needful. All these expectations, together with one’s response to them
comprise the role. Briefly then, an individual occupies a hierarchical position in a
system, along with the ensuing powers and privileges, and performs certain functions
in response to his and the members’ expectations. In this case the former is the office
(or position) and the latter the role.
Role is the position one occupies in a social system, as defined by the functions one
performs in response to the expectations of the ‘significant’ members of a social
system, and one’s own expectations from that position or office.
Role and office (or position), though two sides of the same coin, are, however, two
separate concepts. According to Katz and Kahn, “Office is essentially a relational
concept, defining each position in terms of its relationships to others and to the system
as a whole”. 6 7

Human Resource While office is a relational and power-related concept, role is an ‘obligational’
Development concept. Office is concerned with the hierarchical position and privileges, while a role
is concerned with the obligations of position. Exhibit 1 distinguishes between these
two concepts. While office is a point in the social structure , defining an office
holder’s power, role is the integrated set of behaviours expected from a person
occupying that office.

Exhibit 1 : Office (or Position) and Role

Office/Position Role
Is based on power relations Is based on mutuality
Has related privileges Has related obligations
Is usually hierarchical Is non-hierarchical
Is created by others Is created by others and the role occupant
Is part of the structure Is part of the dynamics
Is evaluative Is descriptive

An organisation can be represented according to the offices, or the roles. Figures 1
and 2 represent a part of an organisation in two different ways.
An office becomes a role when it is actually defined and determined by the
expectations of other office holders (as reflected in the way an office is
discharged by the concerned office holder). Each role has its own system,
consisting of the role occupant and those who have a direct relationship with him,
and thereby, certain expectations from the role. Using the currently accepted
terminology suggested by Katz and Kahn, we will term the ‘significant’ others having
expectations from a role as role senders. They ‘send’ expectations to the role.
The role occupant also has expectations from his role, and in that sense the role
occupant also is a role sender.
Let us take an example. In a family the father has both a position (office) and a
role. The father’s position defines his authority in the family. In some societies
he is the final decision maker and the other members abide by his decisions.
There are certain expectations from the father that define his role—that he
would earn for the family, protect the family against threats, etc. In his
position as the head of the family system, his role is to maintain and protect the
family. While the position gives him some privileges, the role places certain
obligations on him.

Figure 1 : Organization as a Structure of Offices/Positions

A B

C D

E F G H I J

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Figure 2 : Organization as a System of Roles Building Roles and Teams

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A role is not defined without the expectations of the role senders, including the role
occupant. The position of a personnel manager may be created in an organisation, but
his role will be defined by the expectations (started or unstated) that different persons
have from the personnel manager, and the expectations that he in turn, has from the
role. In this sense, the role senders, including the role occupant, define the role in each
system.
However, a question that can be raised is: If the role is defined in each case by the
role senders, how can we talk about a role in general, e.g., the father’s role? While
strictly speaking, a role in general does not make much sense, in a larger social system
the expectations from a role are largely shared, and have common elements. These
are generalised, and we, therefore, talk about the role of the Indian mother, or the role
of a chairman in a public sector concern, etc.
Confusion sometimes arises because the word role has two different connotations. At
times it denotes the position a person holds in an organisation, along with the
expectations from that position (e.g., the role a teacher, a policeman, etc.), and
sometime it describes only the expected behaviour or activities (for example, a
disciplinarian or an evaluator role of a teacher, task and maintenance roles, etc.) For
the sake of convenience we shall use the word role for a position a person holds in a
system (organisation), as defined by the expectations various ‘significant’ persons,
including oneself, have from that person. We will use the term function to indicate a
set of interrelated expectations from a role; developing a sales force and customer
contact are the functions of a salesman’s role.
The concept of role is vital for the integration of the individual with an organisation.
The individual and organisation come together through a role. As shown in Figure 3
the organisation has its own structure and goals. Similarly, the individual has his
personality and needs (motivations). These interact with each other and to some
extent get integrated in a role. Role is also a central concept in work motivation. It is
only through a role that the individual and an organisation interact with each other, as
shown in Figure 4.

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Human Resource Figure 3 : Role as an Integrating Point of an Organization and the Individual
Development

Organization Structure Goals
Role
Individual Personality Needs

Figure 4 : Role as a Region of Individual-Organization Interaction

Individual Role Organization

When a person becomes a member of a social system, he ‘receives’ certain
expectations from other members, and he responds to these, at the same time
projecting his own expectations from the role. Either one of them (responding to
others’ expectations or projecting one’s own expectations from one’s role) may
dominates the other.
One may react very positively and with great satisfaction to others’ expectations, and
fulfil them to the best of one’s abilities. Such a ‘reactive’ (responsive) approach will
help individual take the role effectively. In contrast, another individual may use the
expectations he has from his role (what Kahn and Quinn call reflexive role
expectations) and develop a role behaviour influenced by these expectations. This is
a ‘’proactive’ approach to role performance. Some authors have contrasted these two
approaches, calling the first, ‘role taking’ and the second, ‘role making’ the main
difference being the use of one’s own expectations in defining a role and determining
one’s own role behaviour (as in the latter case).
Katz and Kahn have proposed the concept of ‘role episode’ to explain the process of
role taking. Role taking involves both role-sending (by the ‘significant’ others ) and
role-receiving (by the role occupant). The role occupant and the role senders
constantly interact, and the processes of role sending and role receiving together
influence the role behaviour of the individual. The role senders have expectations on
the basis of their perception of the role occupant’s behaviour. The role occupant acts
on the basis of his perception of the role. However, a person’s role behaviour also
influences the expectations of the role senders. Thus, a role episode has a feedback

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loop. Katz and Kahn have further elaborated on this concept to include the Building Roles and Teams
interaction between role senders and the role occupants as well as the interpersonal
and personality factors.
The other aspect of role taking is concerned with the identification of the self with the
role. If the role expectations are congruent with the self concept, there will be role
acceptance. However, if the expectations conflict with the self-concept, it may result
in what we call self-role distance. Even when there is no evident self-role distance, the
degree of role acceptance can be defined in terms of the intensity with which an
individual is able to get into a role – the intensity may vary from casual role taking to
a moribund identity with the role.

15.2 ROLE SYSTEMS
An organisation can be defined as a system of roles. However, a role itself is a
system. From the individual’s point of view there are two role systems: the system of
various roles which the individual carries and performs, and the system of various
roles of which his role is a part. The first, we will call role space and the second a
role set.
Each individual occupies and plays several roles. A person X, is a daughter, a
mother, a salesperson, a member of a club, a member of a voluntary organisation, and
so on. All these roles constitute the role space of X. At the centre of the role space is
the self. As the concept of role is central to the organisation, so also the concept of
self is central to the several roles of a person. The term ‘self’ refers to the
interpretations the person makes about the referent “I”. It is a cognitive structure that
evolves from past experience with other persons and objects. Self can be defined as
the experience of an identity arising from a person’s interactions with the external
reality – things, persons and systems.
A person performs various roles, which are centred around the self. These roles are at
varying distances from the self (and from each other.). These relationships define the
role space. Role space then is a dynamic interrelationship between the self and the
various roles an individual occupies, and also amongst these roles.
The distance between a role and the self indicates the extent to which the role is
integrated with the self. When we do not enjoy a particular role, or do not get
involved in it, there is a distance between the self and the role. We shall use the term
self-role distance to denote this. Similarly, there may be distance between two roles
that a person occupies. For example, the role of club membership may be distant
from the role of husband. This we will term as inter-role distance or inter-role
conflict.
The role space map of an individual can be drawn by locating the self in the
centre, and various roles occupied at varying distances from the self. Figure 5
presents the role space of a person “A”, who is a personnel manager in a company.
The numbers 9 to 1, for the various circles, represent distances from the self—1
denoting the least distance and 9 the most. The various roles of A are located in
the four quadrants according to the context (i.e., family, organisation,
profession or recreation). More segments of role space can be added in
the diagram.

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Human Resource Figure 5 : Role Space Map of “A”
Development

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The expectations of other significant roles, and those of the individual himself, define
the individual’s role in the organisation. The role set is a pattern of interrelationships
between a role, and the other roles.
The role set map for an individual’s role can be also prepared on the same lines as
those suggested for preparing a role space map. In a role set map the occupants role
will be in the centre, and all the other roles can be located at various points on the
map. Using a circular model, the roles can be located in concentric circles marked 9
to 1-9 indicating the roles closest to the occupant’s role, and 1 indicating those which
are the most distant. We will use the term inter-role distance to indicate the distance
between the occupant’s role and other roles. Lesser distance indicates higher role
linkages (which can be defined as the reverse of inter-role distance). Role linkage is
an important concept in role satisfaction and role conflict. Figure 6 gives the role set
map of a person “A”.

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Figure 6 : Role Set Map of “A” Building Roles and Teams

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Role sets are the sub-systems in an organisation. In Figure 2 nine role sets for the
roles of offices A , B, C, D, E, F, G, H, and I are indicated.
In conclusion, role is a very useful concept in understanding the dynamics of the
integration of an individual with a social system. It also helps in understanding the
problems that arise in this individual-organisation interaction and integration. This
would enable the individual at the centre (called role set). These help an individual
identify several possible role problems.
To sum up, the concept of role goes beyond the individual job holder, and indicates a
need to involve other significant persons in defining the role requirements. The focus
on roles can be useful in planning organisational effectiveness.

15.3 DEVELOPING ROLES: ROLE EFFICACY
The performance of a person working in an organisation depends on his own potential
effectiveness as a person, his technical competence, his managerial experience, etc., as
well as the way the role which the performs in the organisation is designed. It is the
integration of the two (the person and the role) that ensures the person’s effectiveness
in the organisation. Unless the person has the requisite knowledge, technical
competence, and the skills required for the role, he can not be effective. But equally
important is how the role which he occupies in the organisation is designed. If the
role does not allow him to use his competence, and if he constantly feels frustrated in
the role, his effectiveness is likely to be low. The integration of the person and the
role comes about when the role is able to fulfil the needs of the individual, and when
the individual is able to contribute to the evolution of the role. The more we move
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Human Resource from role taking (responding to the expectations by various other persons) to role
Development making (taking initiative in designing the role more creatively in a way that the
various expectations from others as well as of the role occupant are integrated), the
more the role is likely to be effective. Effectiveness of a person-in-a-role-in-an-
organisation, therefore, may depend on his own potential effectiveness, the potential
effectiveness of the role and the organisational climate. The potential effectiveness
can be called efficacy. Personal efficacy would mean potential effectiveness of a
person in personal and interpersonal situations. Role efficacy means the potential
effectiveness of an individual occupying a particular role in an organisation. Role
efficacy can be seen as the psychological factor underlying role effectiveness. In
short, role efficacy is potential effectiveness.

Aspects of Role Efficacy
Role efficacy has several aspects. The more these aspects are present in a role, the
higher the efficacy of that role is likely to be. These aspects can be classified into
three groups, or dimension. One dimension of role efficacy is called “role making”
contrasted with role taking. The first is an active attitude towards the role (to define
and make the role as one likes), whereas the second is a passive attitude (mainly
responding to others expectations). The aspects in the second dimension are
concerned with increasing the power of the role, making it more important. This can
be called “role centering” which can be contrasted with “role entering” (accepting the
role as given, and reconciling oneself to its present importance or unimportance). The
third dimension is called “role linking” (extending the relationship of the role with
other roles and groups), contrasted with “role shrinking” (making the role narrow,
confined to work-related expectations).

Dimension 1: Role making
1) Self-role Integration: Every person has his strength-his experience, his
technical training, the special skills he may have, some unique contribution he
may be able to make. The more the role a person occupies provides an
opportunity for the use of such special strengths, the higher the efficacy is likely
to be. This is called self-role integration. The self of the person and the role get
integrated through the possibility of a person’s use of his special strengths in the
role. In one organisation, a person was promoted to a responsible position. This
was seen as a convertible reward and the person was quite happy in getting such
a well deserved promotion. However, he soon discovered that in the new position
he occupied, he was not able to use his special skills of training, counselling,
and organisational diagnosis. Inspite of his working very well in the new role,
his efficacy was not as high as it was in the previous job. Later when the role
was redesigned to enable him to use his rare skills, his efficacy went up. All of
us want that our special strengths are used in the role so that it may be possible
for us to demonstrate how effective we can be. As such, integration contributes
to high role efficacy. On the other hand, if there is distance between the self and
the role, role efficacy is likely to be low.
2) Proactivity: A person who occupies a role responds to various expectations
people in the organisation have from that role. This certainly gives him
satisfaction, and it also satisfied others in the organisation. However, if he is
also to take initiative in starting some activity, his efficacy will be higher. The
reactive behaviour (responding to the expectations of others) helps a person to
be effective to some extent, but proactivity (taking initiative rather than only
responding to the others expectations) contributes much more to efficacy. But if
a person feels that he would like to take initiative but has no opportunity to do so
in the role he occupies in the organisation, his efficacy will be low.
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3) Creativity: It is not only initiative which is important for efficacy. An Building Roles and Teams
opportunity to try new and unconventional ways of solving problems or an
opportunity to be creative is equally important. In one State Government
Department people performing some clerical roles met, as a part of re-
organisation experiment, to discuss how each individual could experiment with a
system of cutting delays in processing papers. The results were amazing. Not
only did the satisfaction of people in that department go up, but delays were
considerably reduced and some innovative systems emerged. Certainly these
were further discussed and modified, but the opportunity people get in being
creative, in trying innovative ideas increased their role efficacy and their
performance become markedly better than its previous level and compared with
performance of some other departments in the same secretariat. If a person
perceives that he has to perform only routine tasks, it does not help him to have a
high role efficacy. If he feels that his role does not allow any time or
opportunity to be creative, his efficacy will be low.
4) Conformation: In general, if people in an organisation avoid problems, or shift
the problems to some other people to solve them, their role efficacy will be low.
The general tendency to confront the problems to find relevant solutions
contributes to efficacy. When people facing interpersonal problems sit down,
talk about these problems, and search solutions, their efficacy is likely to be
higher compared with situations in which they either deny such problems, or
refer these to their higher officers.

Dimension 2 : Role Centering
5) Centrality: If a person occupying a particular role in the organisation generally
feels that the role he/she occupies is central in the organisation, his/her role
efficacy is likely to be high. Every one working in an origination wants to feel
that his/her role is important. If persons occupying the various roles feel that
their roles are peripheral, i.e., they are not much important , their potential
effectiveness will be low. This is true not only of persons at a higher level in the
organisation, but about people even at the lowest level. In a large hospital, class
IV employee like ward boys and attendants had very high motivation when they
joined the hospital. And coming from nearby villages, they would bring their
friends and relatives to proudly show the place where they were working.
However, within a few months, they neglected work, sat in groups gossiping and
not caring about the cleanliness, etc. They were rated as very low in their
effectiveness. An investigation of this problem showed that within a few months
of their joining the hospital, their perception changed about the perceived
importance of their role, they felt that their role was not important at all. In
contrast, with this, in another hospital, the guard was trained to screen the
requests of visitors who wanted to have some exceptions to the rule of coming
only furring the visitors’ hours. He used his discretion in making or not making
exceptions in such cases, and referred a case to the nurses or doctors only for
clarification and guidance for himself. Interviews with Class IV employees in
this hospital showed that they perceived their roles as quite important. One
obvious difference in low motivation of the former, and higher motivation of the
latter, was their perceived importance of their roles.
6) Influence: A related concept is that of influence or power. The more influence
a person is able to exercise in the role, the higher the role efficacy is likely to be.
One factor which may make roles in the public-sector or civil service more
efficacious is the opportunity to influence a larger sector in the society. On the
other hand, if a person feels that he has no power in the role he occupies in the
organisation, he is likely to have low efficacy.
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Human Resource 7) Personal growth: One factor which contributes effectively to role efficacy is the
Development perception that the role provides the individual an opportunity to grow and
develop. There are several examples of people leaving one role and becoming
very effective in another primarily because they feel that they have more
opportunity to grow in the latter. One head of a training institute accepted the
position by taking a big financial cut in his salary mainly because he felt that he
had nothing more to learn in the previous role, and in the new role, he had
opportunities to grow further. Examples of executives of companies going for
faculty roles in the institutes of management indicate the importance of the factor
of self-development for role efficacy. If a person feels that he is stagnating in the
role and does not get any opportunity to grow, he is likely to have low role
efficacy. In many institutes of higher learning; the roles of the staff have low
efficacy. The main factor contributing to this is the lack of opportunity for them
to systematically grow in their roles. The institutes which are able to plan the
growth of such people in the roles are able to have higher efficacy and a great
deal of contribution from them.

Dimension 3: Role Linking
8) Inter-role linkage: Linkage of one’s role with other roles in the organisation
increases efficacy. If there is a joint effort in understanding problems, finding
solutions, etc., the efficacy of the various roles involved is likely to be high. Of
course, the presumption is that people know how to work effectively. Similarly,
if a person is a member of a task-group set up for a specific purpose, his
efficacy, with other factors being common, is likely to be high. The feeling of
isolation of a role (that a person works without any linkage with other roles)
reduces role efficacy.
9) Helping relationship: In addition to inter-role linkages, the opportunity for
people to receive and give help also increases role efficacy. If persons
performing a particular role feel that they can get help from some source in the
organisation , whenever they have such a need, they are likely to have higher role
efficacy. On the other hand, if there is a feeling that either no help is given when
asked for, or that the respondents are hostile, role efficacy will be low. Helping
relationships is of both kinds—feeling free to ask for help and expecting that help
would be available when it is needed, as well as willingness to give help and
respond to the needs of others.
10) Superordination: A role may have linkages with systems, groups and entities
beyond the organisation. When a person performing a particular role feels that
what he does as a part of his role is likely to be of value to a larger group, his
efficacy is likely to be high. The roles which give opportunities to role occupants
to work for superordinate goals have very high role efficacy. Superordinate
goals are goals of serving large groups, and those which cannot be achieved
without some collaborative effort. One major motivation for people at the top to
move to public-sector undertakings is to have opportunity to work for larger
goals which are likely to help larger sections of the society. Many people have
voluntarily accepted cuts in their salaries to move from the private sector to the
public sector at the top level, mainly because the new role would give them an
opportunity to serve a larger interest. Roles in which people feel that what they
are doing is helpful to the organisation in which they work, also results in some
role efficacy. But if a person feels that he does not get an opportunity to be of
help to a larger group in his role, his role efficacy is likely to be low.
Regarding the personal profile of role efficacy, research has shown that persons with
high role efficacy seem to rely on their own strengths to cope with problems , they
are active and interact with people and the environment, and persist in solving
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problem mostly by themselves and sometimes by taking help of other people. They Building Roles and Teams
show positive and approach behaviour, and feel satisfied with life and with their jobs
and roles in their organisations. Such a profile is that of effective managers.
Regarding organisational aspects a participative climate, in which the employees get
higher job satisfaction contributes to role efficacy. It seems that the climate
promoting concern for excellence, use of expertise, and concern for the larger issues
also contributes to role efficacy. On the other hand, a climate characterized by control
and affiliation seems to lower employee’s role efficacy (Sayeed and Pareek, 2000 for
results of researches on role efficacy).

Increasing Role Efficacy
One can plan to increase role efficacy of one’s own role, as well as those of one’s
employees. Some practical suggestions, based on work in some organisations, are
given for the supervisors to increase role efficacy of their employees.

Self- Role Integration
1) Work with the employees in redesigning their roles in which their strengths can
be utilised.
2) Recommend replacement of a misfit in a job which can use his assets.

Proactivity
1) Minimise supervision of employees, and encourage them to ask for your help
when they need such help.
2) Reward initiative of employees.
3) Listen to the employees, give respect to their views, and use these wherever
possible.
4) Arrange for visits of the employees to other organisation.

Creativity
1) Encourage your employees to give ideas to solve problems.
2) Crate a climate which encourages people to generate ideas without fear of
being criticised.
3) Appreciate and use new ideas given by the employees.
4) Encourage and reward suggestions to solve problems.

Confrontation
1) Take the employees into confidence while confronting a problem.
2) Support the action taken by the employee if it is within the rules and procedures.
3) Appoint a task group for a problem making decision.
4) Use failure of an employee as an experience and help him to learn from it.
5) Encourage employees to bring problems.
6) Anticipate problems in collaboration with your employees.
7) Encourage subordinates to solve problems and report to you.
8) Follow the “buck stops here” dictum.

Centrality
1) Communicate the importance of the roles to their incumbents (the critical
contributions of the roles). 7 7

Human Resource 2) Communicate the importance of the roles as perceived by others.
Development
3) Give enough freedom to each employee to set his objectives and decide ways of
achieving them.
4) Give increasingly difficult and challenging responsibilities.

Influence
1) Delegate enough authority.
2) Give relevant details of decision made.
3) Send good ideas of employees to higher management.
4) Give feedback to employees on their suggestions.
5) Be willing to accept mistake.

Growth
1) Appreciate employee’s work.
2) Do not snub the employees for their shortcomings but cooperate to improve
them.
3) Delegate to them increasingly difficult and challenging tasks.

Inter-role Linkage
1) Encourage employees to seek/render cooperation with departments.
2) Encourage employees to solve problems by working with their peer-level
colleagues (and not refer the problems to you unless it needs your intervention).

Helping
1) Encourage the employees to respond to requests by other departments.
2) Encourage them to seek help from peers from other departments.
3) Seek help of your employees in areas they can contribute.
4) Encourage your employees to come to you for help, and respond to them
positively.

Superordination
1) Help employees to understand and appreciate the contribution of their role to the
society.
2) Help the employees link (and see the linkage ) of objectives of their roles with
organisational objectives.
3) Encourage them to include in their roles what may be useful for a larger section.
4) Encourage team work.
5) Communicate accessibility to the employees.

15.4 THE CONCEPT OF TEAM
Most of the work in organisations is done in teams. Even though individuals are
important, their effectiveness depends, to a large extent, on the teams of which they
are members. In modern organisations individuals are required to work in different
types of teams. In fact, new organisations can be described as composed of teams.
What is a team? A team consists of individuals. However, collection of individuals in
a place may be only a crowd. When the individuals come together for certain tasks,
7 8 then we have formation of a group. The main function of a group is to exchange task-

related information and discuss task-related issues.The accountability in the group Building Roles and Teams
remains of the individual. Each individual brings his/her competencies as well as the
relevant information related to the task. Thus the group can be defined as a collection
of individuals working in face-to-face relationship to share information and resources
for a task to be achieved. The team is qualitatively different from the group in
several ways. The team functions almost like an individual. In other words, the team
is accountable for results; collective responsibility is taken. There is mutuality and
complementarity of the members of the team. The most important characteristics of a
team is that it creates synergy, i.e., the performance of the team is more than the
collective performance of the individual members. A team can be defined as a group
of individuals working in face-to-face relationship for a common goal, having
collective accountability for the outcome of its effort. Exhibit 2 shows the difference
between groups and teams.

Exhibit 2 : Difference Between Work Groups and Teams*

Work Groups Teams
1 Propose Same as organisation Specific
2 Work Products Individual Collective
3 Process Discuss, decide, delegate Discuss, decide, do
4 Leadership A single leader Shared
5 Meetings Efficient Open, problem-solving
6 Accountability Individual Individual and mutual
7 Evaluation Indirect (e.g. financial) Direct (collective work
product)

* Adapted from Katzenback & Smith, 1993

As already stated, a team has several characteristics : members are inter-dependent; it
has a common goal or goals; each member’s contribution is as important as any other
member’s contribution; there is congruence between achievement of individual goals
and that of the team goal.
The importance of teams was first realised by the results of the famous Hawthorne
studies in 1930s. However, it was McGregor who gave special attention to teams in
1960s. Likert during the same period focused attention on teams as important
elements of humanisation of organisations.

15.5 TEAM DEVELOPMENT
Teams take time to develop. A team is not formed merely by declaring some
individuals as a team. A lot of research has been done on group formation and
development, and different theories of groups development have been suggested
(e.g.Bennis & Shepard, 1956; Bion, 1961; Gibb, 1964; Schutz, 1958, 1982;
Tuckman, 1965; Tuckman & Jensen, 1977; and Yalom, 1970). Tuckman (1977)
summarising the various theories suggested five stages of group development.
Tuckman’s model has been widely accepted: forming, storming, norming, performing,
and adjourning. Kormanski & Mozenter (1987) integrated the various theories and
suggested the following stages of team development. These stages are sequential
(each stage is followed by the next one). Each stage has a task outcome and a
relationships outcome, as shown in Exhibit 3.

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Human Resource Exhibit 3 : A Model of Team Building
Development
Stage Theme Task Outcome Relationship Outcome
One Awareness Commitment Acceptance
Two Conflict Clarification Belonging
Three Cooperation Involvement Support
Four Productivity Achievement Pride
Five Separation Recognition Satisfaction

1) Awareness: At this stage individuals get to know each other. By knowing the
goals of the team they commit themselves to the goals. The members get to
know and accept to work together for a goal about which they have enough
knowledge.
2) Conflict: At the first stage (awareness) the members know the team goals and
accept to work together; but this is at the surface level. At the second stage they
search and begin to ask questions. As a result several matters are clarified.
They also fight with each and in this process of interaction resolve any hostilities
they may have, resulting in the feeling of belonging to the group.
3) Cooperation: In the third stage the members own the team goals and get
involved in those goals. Having resolved feelings, they also support
each other.
4) Productivity: This is the stage of real achievement of the goals/outcomes,
and the team members achieving these objectives feel proud of their
achievement.
5) Separation: Having accomplished the goals or the outcomes, some task-specific
teams may decide to get dissolved, or a time-bound time comes to a close. The
excellent work done by the members is recognised, and the team members have a
high sense of satisfaction of working with each other. This is the stage of closure
of the team, or closure of one task on which the team was working.
Pradip Khandwalla, who has done pioneering studies of turnaround of organisations,
concludes “the Great Person model of turnaround maker has to be replaced by the
growing Great Team model of turnaround facilitation (Khandwalla, 1992). The
following caselet illustrates how team can be used in turning around an organisation.

Turnaround through Teams *
Lakhanpal National Limited is a Japanese joint venture operating in India and
producing and marketing the well-known Novino batteries. In 1990, the company
launched the ‘Human 21’ campaign of innovation to ‘double performance’ by 1993.
The campaign was designed by Matsushita Electric, one of the owners of
Lakhanpal. A company brochure explained ‘Human 21’ as a campaign to
use all the potential energies within the staff in a visible and pronounced manner so
that the company could be fully ready to meet the challenges of the 21st century.
Each department/section undertook to double by 1993 the performance in its
work area.
Seventy-two sub-themes were identified and teams were formed to pursue each one of
these. Some of the sub-themes were: the formulation of a system for improving the
health of the employees; reduction of the rejection of good cells by 50%; reduction of
parts section manpower by 50%; reduction of falling of battery jacket on the floor by
50%; achievement of zero ageing of a particular type of battery; cutting of water

8 0 * Reproduced with permission from Khandwalla, 1992, p.256, with modified title.

consumption by 50%; reduction of total inventory level by 50%; doubling of computer Building Roles and Teams
utilisation; reduction of the import of spares by half;’ halving of electrical breakdown
time loss; increase of output of a battery by 70% without increase in manpower;
improvement in working area and working conditions ‘twofold’; reduction of
telephone expenses by 50%; beautification of the reception area; lifetime employment
and career development plan for employees; doubling sales to institutions and
doubling of sales volume in various states; preparation of consolidated sales
report by the 5th of each month instead of the 10th; having the annual general
meeting of the company within three months of year end instead of six; reducing
manual work load in preparing accounts by 50% through computerisation;
preparing costing data within 20 days of the quarter ending instead of 40;
implementing systematic job rotation; doubling the productivity of every
manufacturing section; and reducing electrical machinery breakdowns by 50%
through better plant maintenance.
Notice the large range of areas where drastic improvement was sought. Notice also
the mundane, down-to-earth nature of them: production, loading finished goods,
maintenance, preparation of accounts and reports, wastage, etc. Not “image’,
goodwill, ‘professionalisation’, ‘morale’, ‘technological excellence’, ‘marketing
excellence’ or other such abstract arenas of management. The strategy was of
achieving large improvements through team effort in very many specific areas of
operations. The strategy also seemed to be one of forcing innovation by overloading.
It is obvious that without innovation in every tangible area of operations, doubling
performance in three years would be an empty slogan.

15.6 MAKING TEAMS EFFECTIVE
McGregor and Likert, who gave importance to teams in 1960s, listed a large number
of characteristics of effective work groups or teams. Dyer (1987pp.12-16) has
summarised 11 characteristics of an effective work team suggested by McGregor, and
24 characteristics of an effective work group as suggested by Likert. Exhibit 4 lists
10 main characteristics of effective teams, covering suggestions given both by
McGregor and Likert. The numbers in the Exhibit refer to the serial number of the
suggestions by Dyer.

Exhibit 4 : Characteristics of Effective Work Teams (McGregor and Likert)

McGregor Likert
1. Commitment and Inspiring Goals 8, 12, 13
2. Role Clarity 3, 9 23
3. Self-disclosure (including Confrontation) 5, 7, 8, 11 17
4. Opnness to Feedback 4 18, 19
5. Competence 1
6. Creativity with Constructive Confronting 15, 16
7. Collaboration/Support/Trust 1 2, 4, 9, 14
8. Congruence between Individual and Group Goals 3, 5, 6, 7, 11
9. Supportive Leadership 10, 24
10. Management of Power 2, 6, 10 20, 21, 22

Several types of teams function in an organisation. The most common are the teams
composed of individuals who are assigned a particular task to be completed in a given
time. These are natural teams of which organisation is composed. These may be
departmental teams or teams set up to complete some tasks. Special teams which are 8 1

Human Resource constituted to work on some assignments to be completed within a time period are
Development called Task Forces. Continuing groups or those which are set up for a particular
period of time to deal with certain issues are generally called Committees. Special
teams may also be constituted to complete a particular task; of these may be Project
Teams. Attention needs to be given to make all such teams effective in accomplishing
their goals.
In addition to work teams and other teams in the organisation attention also needs to
be given to working of two or more teams together. These may be cross-functional or
inter departmental or inter-level teams. Inter team functioning is increasing in most
organisations, as such significant attention is to be given to teams.
Team effectiveness can be conceived from several angles. To use the Joharl Window
concept , an effective team is one in which people give their opinions and comments
without hesitation; listen to others and examine others opinions comments and feed-
back given by colleagues at all levels; and are sensitive to the needs of others (called
perceptiveness). An instrument measuring effectiveness from this point of view is
available (Pareek, 2002).
Team effectiveness can also be understood in terms of team functioning and team
empowerment. These are three main characteristics of team functioning: cohesion
(amongst members of the team), confrontation i.e., solving problems as they arise,
rather than shying away from them; and collaboration, i.e., working together, giving
and receiving help to each other. The four main characteristics of team empowerment
are: clarity of roles of different members of the team, autonomy of the team, support
provided to the team in terms of resources etc., and accountability of the team to
achieve the goals to which commitment has been made. Pareek (2002b, Chapter 83)
has developed an instrument to measure team effectiveness, using this concept.
How can we make teams more effective? The process of making teams effective is
called team building. There are several approaches to team building, depending on the
kind of conceptual framework we use. Some of the approaches are as follows:
1) Johari Window Approach : According to this approach team building will
involve helping individuals to take risk and frankly express their opinions and
reactions, help them to accept feedback from others with enough opportunity to
explore further and increasing their sensitivity to and perceptiveness of others’
needs and orientations. This can be done by developing a profile of a team based
on individual members responses to an instrument (eg. The Instrument in
Pareek, 2002).
2) Role Negotiation Approach: Team building can be done by using role
negotiation (Harrison, 1971). Members of the team share each others’ images
and then list expectations of what they would like the other group to continue to
do, stop or reduce, and start or increase doing something which will make ones
own group more effective. Based on such expectations negotiation between the
two teams are to develop more and more collaboration between the two teams.
Team Roles Approach : As already mentioned Belbin (1981) suggested eight
‘team roles’ which people take (chairman/coordinator, shaper, plant, monitor/
evaluator, company worker, resource investigator, team worker, completor/
finisher). Team building can be done by setting up effective teams and
developing teams (Pareek, 1993).
3) Behaviour Modification Approach: Team building can also be done by helping
people to become more effective in their individual orientations. . Collaboration
depends on the individual’s orientation styles and attitudes. According to this
approach some instruments (Pareek, 2002) are used to help individuals examine
their styles and orientation and then increase their own effectiveness by
8 2

modifying their behaviour. This is seen as an important way to enhance Building Roles and Teams
individuals’ potential for collaboration and team building. Using the concept of
power, as already suggested, an instrument (Pareek, 2002) can be used to help
team members examine their bases of power, and plan to increase their
persuasive power.
4) Simulation Approach: Team building can be attempted by creating artificial
teams in which people have an opportunity to experiment and learn from their
behaviour in less threatening context. Various games or exercises are used for
this purpose, like Broken Squares, Hollow Square, Win As Much As You Can,
Maximising Your Gains etc. (Pareek & Rao, 1991). After people participate in
such games they also discuss how similar dynamics operate in their backhome
situation, and how they can use their learnings from simulations to make their
own teams effective.
5) Action Research Approach: In this approach team building is done through
several steps which are generally taken in action research or organisation
development. Dyer (1978) has used this approach in his elaborate discussion of
team building through five stages: data strengthening, data analysis, action
planning, implementation, evaluation. In this approach diagnosis is done on the
basis of questionnaires, interviews or observations. The steps involved in action
research and OD are taken in this approach.
6) Appreciative Inquiry Approach: In this approach emphasis is given more on
the positive aspects, including inspiring future dreams or goods, , and
appreciating positive qualities in each other. Appreciative Inquiry (Cooperrider
& Whitney, 1999) has become quite popular as a method of increasing
collaboration amongst people for building strong teams.
Combining the various approaches the following steps are suggested for team
building:
1) Projection in the future: The team may prepare a common understanding
desirable future of the team. Members individually or in a small groups may
prepare a picture of their team as they see it in the next five or seven years. A
special future scenario will help to inspire individuals to move towards it. The
future is a better diagnosis device than analysis of the past
2) Linkage with individual goals: The future fantasy of the team should be linked
with the individuals aspirations and goals. Individuals in small groups may
discuss how their own expirations and goals of life can be achieved through the
ideal future of the team being developed by the group.
3) Force field analysis : the team may identify the forces which are positive and
helping the team to move towards the desirable future, and the forces which are
likely to hinder its progress towards the future. Such analysis is helpful to move
to the next step.
4) Strengthen positive forces: The team may go into details of reinforcing the
positive aspects which may help the team to achieve its desirable future. They
can take each positive force and work out plans to strengthen it further.
5) Reducing negative forces: The team can take up all the
restraining or inhibit forces and can plan specific action steps to reduce, if not
eliminate them.
6) Monitoring: After decisions are taken to work on strengthening positive forces,
and reducing negative forces a plan can be prepared to monitor action being
taken. Responsibility of monitoring can be taken up by one or two persons, and
the team may meet from time to time to review the progress of action being
taken.
8 3

Human Resource Whatever approaches are adopted for team building, emphasis should be given on
Development understanding team effectiveness and taking steps to increase its level. Similar steps
can be taken for building inter-team collaboration. Dyer (1987) also discusses ways
of dealing with intra-team and inter-team conflicts. Team members have the
responsibility of making their teams effective. Kormanski & Mozenter (1987)
have suggested the following characteristics of team members contributing to
team effectiveness. They have suggested that these characteristics are in a
sequential pattern, alternating task and relationship behaviours. Members in
effective teams:
l Understand and are committed to group goals;
l Are friendly, concerned, and interested in others;
l Acknowledge and confront conflict openly
l Listen to others with understanding
l Include others in the decision-makfing process;
l Recognize and respect individual differences;
l Contribute ideas and solutions;
l Value the ideas and contributions of others;
l Recognize and reward team efforts; and
l Encourage and appreciate comments about team performance.

15.7 SUMMARY
People play different roles in different positions and places. In organisation point of
view, the concept of role is vital integrating an individual with an organisation.
An organisation can be defined as a set of roles and a person plays various roles
centred around himself. The performance of a person in an organisation depends
upon the integration of the person and the role he plays, which in turn is the role
efficacy. Role efficacy has three dimensions: role making, role centering and role
linking. Supervisors can increase their subordinates’ role efficacy by adopting few
measures like self role integration, proactivity, creativity etc. Similarly teams
consists of individuals with common objectives. There are several approaches
to team development like Johari window, role negation, behaviour
modification etc.

1) Define “role” and distinguish role from position, citing examples.
2) Write a comprehensive note on “role efficacy” and enumerate its different
aspects.
3) Discuss different approaches to team development with illustrations.

Kahn, R.L, R.P. Wolfe, P. Quinn; J.D Shock & R.A. Rosenthal (1964).
Organisational stress : Studies in role conflict and ambiguity. New York : Wiley.
Pareek, Udai (1993) Making organisational roles effective, New Delhi: Tata
McGraw-Hill.
Sayeed, O.B & Udai Pareek (Eds.) (2000) Actualising managerial roles:
Studies in role efficacy, New Delhi : Tata McGraw – Hill.
Dyer, W. (1994) Team building: Issues and alternatives. Reading, Mass.: Addison &
8 4 Wesley

Laws Covering Wages,
UNIT 16 LAWS COVERING WAGES, Welfare and Benefits

WELFARE AND BENEFITS
Objectives
l explain the salient features of Payment of Wages Act;
l understand the main provisions of Minimum Wages Act;
l describe the main features of Payment of Bonus Act;
l realise the importance of Equal Remuneration Act for the betterment of female
employees; and
l understand different social security benefits granted under social security
enactments.

Structure
16.1 Introduction
16.2 The Payment of Wages Act, 1936
16.3 The Minimum Wages Act, 1948
16.4 The Payment of Bonus Act, 1965
16.5 The Equal Remuneration Act, 1976
16.6 Statutory Social Security Benefits
16.7 Summary

16.1 INTRODUCTION
Wages are among the major factors in the economic and social life of any community.
It has ethical, social, economic, political, psychological, and legal ramifications in
organisational life. The International Labour Organisation (ILO) has adopted various
conventions and recommendations laying down the principles and methods of wage
payment and fixation. The Constitution of India enshrines the concept of social justice
as one of the objectives of the State, which it seeks to achieve, among other things,
through labour legislation. The legal framework on wages in our country includes:
(i) the Payment of Wages Act, 1936; (ii) the Minimum Wages Act, 1948; (iii) the
Payment of Bonus Act, 1965; and (iv) the Equal Remuneration Act, 1976; and the
rules framed there under by the Government. Under different social security
enactments, the employers are also required to provide various benefits to the
employees in cash and kind.

16.2 THE PAYMENT OF WAGES ACT, 1936
The Royal Commission on Labour in its report (1931) recommended, among other
things, that legislation on timely payment of wages, deductions from wages and fines,
was necessary and desirable. In the light of its recommendations, the Government of
India introduced a bill in 1936, and the Act came into force from 28th March, 1937.
The Payment of Wages Act is in three parts. Part I deals with the regulation and 5

Compensation and payment of wages by the employer. Part II specifies the heads under which deductions
Reward Management can be made from wages. Part III provides machinery for enforcing specific claims
arising out of delayed payments, deduction from wages, appeals, etc. It is a self-
contained Act and provides its own machinery for the disposal of the claims. The Act
contains 26 Sections.

Object of the Act
The object of the Act is to regulate the payment of wages to certain classes of persons
employed in industry in a particular form and at regular intervals; and to prevent
unauthorised deductions from the wages. The Act is concerned merely with the
fixation of wage periods and not with the fixation of wages.

Applicability
The Act is applicable to persons employed in any factory, railway, and to such other
establishments to which the State Government may, by notification, extend the
provisions of the Act after giving three months’ notice to that effect. In the case of
industrial establishments owned by the Central Government the notification can be
issued with the concurrence of the Central Government.
Employees whose average wage is less than rupees 1,600 a month are covered under
the Act. The Payment of Wages (Amendment) Bill, 2002 provides for the
enhancement of the wage ceiling to rupees 6,500 per month.

Definitions
“Wages” means all remuneration (whether by way of salary, allowances or otherwise)
expressed in terms of money or capable of being so expressed which, if the terms of
employment express or implied were fulfilled, would be payable to a person employed
in respect of his employment or of work done in such employment. It includes:
i) Any remuneration payable under any award or settlement between the parties or
order of a court;
ii) Any remuneration to which the person employed is entitled in respect of
overtime work or holidays or any leave period;
iii) Any sum which by reason of the termination of employment of the person
employed is capable under any law, contract or instrument which provides
for the payment of such sum, whether with or without deduction but does
not provide for the time within which the payment is to be made.
iv) Any sum to which the person employed is entitled under any scheme framed
under any law for the time being in force.
However, it does not include:
i) Any bonus (whether under a scheme of profit sharing or otherwise) which
does not form part of the remuneration payable under the terms of employment
or which is not payable under any award or settlement between the parties or
order of a court;
ii) The value of any house accommodation or of the supply of light, water,
medical attendance or other amenity or of any service excluded from the
computation of wages by a general or special order of the state government;
iii) Any contribution paid by the employer to any pension or provident fund
and the interest which may have accrued thereon;
iv) Any travelling concession;
6

v) Any sum paid to the employed person to defray special expenses entailed on him Laws Covering Wages,
by the nature of his employment; or Welfare and Benefits

vi) Any gratuity payable on the termination of employment
The term “establishment” includes:
a) tramway service or motor transport engaged in carrying passengers and goods or
both by road for hire or reward;
b) air transport service other than such service belonging to, or exclusively
employed in the military, naval or airforce of the Union, or the Civil Aviation
Department of the Govt. of India;
c) dock, wharf, or jetty;
d) inland vessel mechanically propelled;
e) mine, quarry or oil field;
f) plantation;
g) workshop, or other establishments in which articles are produced, adapted, or
manufactured, with a view to their use, transport or sale;
h) establishment in which any work relating to the construction, development or
maintenance of building, roads, bridges or canals or relating to transmission, or
distribution of electricity, or any other form of power is being carried on;
i) any other establishment, or class of establishments, which the Central or a State
Government may notify in the Official Gazette.

Wage Payment
The responsibility for the payment of wages under the Act is that of the employer or
his representative. In the absence of the employer, a person who employs the labourers
and with whom they enter into a contract of employment will be regarded as the
employer.
No wage period shall exceed one month in any case. The main purpose of this
provision is to ensure that inordinate delay is not caused in the payment of wages and
that a long time does not elapse before wages are paid for the period for which an
employee has worked.
Wages may be payable daily, weekly, fortnightly and monthly. But the payment
thereof must not extend over a period longer than one month (month means a solar
month; a period of four weeks or 30 days).
Where less than 1,000 persons are employed, wages shall be paid before the expiry of
the 7th day and in other cases before the expiry of the 10th day, after the last day of
the wage period. If for instance, the wage period fixed is the first day of January to the
thirty-first day of January an employed person working in any railway, factory
or industrial establishment in which less than one thousand persons are employed
would be entitled to receive his wages before the seventh day of February and in other
cases on the tenth day of February in respect of the wage period of January.
In case the employer terminates the services of an employee, the employee is entitled
to receive the wage earned by him before the expiry of the 2nd working day from the
day on which his employment has been terminated. The weekly or other recognised
holiday is to be excluded in computing the second working day.
All wages shall be paid in current coin or currency notes or in both. The employer
may, after obtaining the written authorisation of the employed person, pay the wages
either by cheque or by crediting the wages into his bank account.
7

Compensation and Deductions from Wages
Reward Management
Wages shall be paid to an employed person without deductions of any kind except
those authorised by or under the Act. Withholding of increment or promotion
(including the stoppage of increment at an efficiency bar); reduction to a lower post or
time scale or to a lower stage in a time scale and suspension are not deemed to be
deductions from wages.
The term ‘deduction from wages’ has not been defined in the Act. However, the Act
specifies the heads from which deductions from wages may be made.
Deductions may be made by an employer, with the written authorisation of the
employed person, from the wages payable to such an employed person, for
payment of contribution to any welfare fund constituted by the employer for the
welfare of employed persons and the members of their families, and also for the
payment of the fees payable by the employed person for membership of any registered
trade union.
There are also certain deductions peculiar to railways, such as deductions for recovery
of losses sustained by railway administration on account of certain omissions and
commissions on the part of the employees.
The total amount of deduction which may be made in any wage period from the wages
of an employed person shall not exceed 75 per cent of such wages in cases where such
deductions were wholly or partly made for payment to co-operative societies; and in
any other case, 50 per cent of such wages.
There are certain conditions and limits subject to which fines may be imposed.
These are:
i) A fine can be imposed only for such acts or omissions as are specified by the
employer and previously approved by the State Government;
ii) A notice specifying such acts or omissions must be exhibited on the premises in
which employment is carried on;
iii) A person involved must be informed in writing the reasons for
imposing fine;
iv) No fine shall be imposed on an employed person who is under the age of 15
years.
v) No fine shall be recovered from an employed person by instalments after the expiry
of 60 days from the day on which it was imposed;
vi) The total amount of fine in one wage period shall not exceed an amount equal to
3 per cent for that wage period;
vii) All realisations by way of fine have to be recorded in a register and must be
applied only for such purpose as are beneficial to the persons employed in the
factory or establishment as are approved by the prescribed authority.
The Act authorises deductions for actual absence from duty. However, if 10 or
more employed persons acting in concert absent themselves without due notice and
without reasonable cause, such deductions may be made for a maximum period of
8 days.
Deductions from wages for damage or loss caused to the employer by the neglect or
default of the employed person have been laid down under the Act. Such deductions
can be made only after giving the person concerned an opportunity of showing cause
against the deductions. All such deductions and realisations are to be recorded in a
register.

8

Exhibit 16.1 Laws Covering Wages,
Welfare and Benefits
List of Authorised or Permissible Deductions

1) Deductions for fines.
2) Deductions for absence from duty.
3) Deductions for damage or loss.
4) Deductions for house accommodation.
5) Deductions for amenities and services.
6) Deductions for recovery of advances or for adjustment of over
payment of wages.
7) Deductions for recovery of loans made for the welfare of labour.
8) Deductions for recovery of loans granted for house building.
9) Deductions for payment to co-operative societies and insurance schemes.
10) Deductions of income tax.
11) Deductions made under orders of court.
12) Deductions for contributions to provident fund.
13) Deductions for the welfare of the employed persons.
14) Deductions in respect of fees payable for the membership of trade union.
15) Deductions for payment of insurance premia on fidelity guarantee bonds.
16) Deductions for recovery of losses sustained by railway administration.
17) Deductions for contribution to the Prime Minister’s National Relief Fund.
18) Deductions for contributions to any insurance scheme.

Authorities
The Act makes provision for the appointment of inspectors. The Inspector of Factories
is also the Inspector under this Act.
The Act also provides for the appointment of a person to be the authority to hear and
decide, for any specified area, claims arising out of deductions from wages or delay in
payment of wages.
The authority under the Act can only adjudicate upon claims regarding deductions and
delay in payment of wages and not upon any dispute in respect of wages.
An appeal lies against the decision of the authority to a Court of Small Causes in a
metropolitan town and before the District Court elsewhere within a period of one
month.
The Act prescribes penalties for offences committed under the Act.
Any contract or agreement whereby an employed person relinquishes any right
conferred by this Act shall be null and void.

Obligations of Employers
1) To fix the wage-period not exceeding one month.
2) To pay wages in cash or by cheque after taking written authorisation of the
employed person. 9

Compensation and 3) To pay wages on any working day.
Reward Management
4) To make deductions permissible from the wages of the employed person.
7) To ensure that deductions do not exceed 75% where payment to a cooperative
society is to be made, and in other cases, deductions do not exceed 50%.
6) To seek, before imposing fines approval of list of acts and omissions from the
prescribed authority.
7) Not to impose fines exceeding 3% of the wages on the employee.
8) To give show-cause notice to the employed person before imposing fines.
9) To recover fines within 60 days of the date of offence.
10) To afford facilities to Inspectors for entry, inspection, supervision, examination
or inquiry under the Act.
11) To display abstract of the Act and the Rules in English and in a language
understood by the majority of workmen.
12) To maintain following register in the prescribed forms:
i) Register of wages;
ii) Register of fines;
iii) Register of deductions for damage or loss;
iv) Register of advances.
Apart from maintaining necessary records and registers, the employer is required to
display an abstract of the Act at a conspicuous place.

Obligations of Employees
Every employee is entitled:
1) To receive his wages in the prescribed wage period in cash or by
cheque or by credit to his bank account.
2) To refuse to agree to any deductions and fines other than those authorised under
the Act.
3) To approach within six months the prescribed authority to claim unpaid or
delayed wages, unauthorised deductions and fines along with compensation.
4) To appeal against the direction made by the authority if the amount of wages
claimed exceeds rupees one hundred.

16.3 THE MINIMUM WAGES ACT, 1948
The genesis of the Minimum Wages Act is traceable to the Minimum Wage Fixing
Machinery Convention, 1928 (No. 28) of the International Labour Organisation
(ILO). This Convention has become one of the most widely accepted instruments of
the ILO. The Minimum Wages Bill was introduced in the Central Legislature in 1946
and was passed in 1948. The Act contains 31 Sections.

Object of the Act
The Act aims to extend the concept of social justice to the workmen employed in
certain scheduled employments by statutorily providing for them minimum rates of
wages. It is a piece of social legislation which provides protection to workers in
employments in which they are vulnerable to exploitation by reason of the
lack of organisation and bargaining power and where sweated labour is most
prevalent.
1 0

Applicability Laws Covering Wages,
Welfare and Benefits
The Act is not applicable to all employments or industries. A schedule appended to the
Act gives a list of employments covered by the Act. It covers an establishment
regardless of the number of workers actually employed. Some of the employments are
listed in Part I of the schedule. Part II of the schedule contains employment in
agriculture and other allied activities.
The appropriate government may add to the schedule any other employment in respect
of which it is of the opinion that minimum rates of wages should be fixed.
The contract labour, falling within the purview of the Contract Labour (Regulation
and Abolition) Act, 1970, has to be paid mininum wages under the Minimum Wages
Act.

Definitions
The Act contains a number of definitions. Some of the important definitions are the
following:
Appropriate Government: In this Act, the term “appropriate government” means:
Central Government– for any scheduled employment carried on under the authority
of Central Government or railway administrations and for a mine, oilfield or major
port or any corporation established by a central act.
State Government– for any other scheduled employment carried on within its
territory.
Wages: “Wages” means all remuneration capable of being expressed in terms of
money, which would, if the terms of the contract of employment, express or implied,
were fulfilled, be payable to a person employed in respect of his employment or of
work done in such employment, and includes house rent allowance but does not
include:
i) The value of any house accommodation, supply of light, water, medical
attendance; or any other amenity or any service excluded by general or special
order of the appropriate government;
ii) Any contribution paid by the employer to any pension fund or provident fund or
under any scheme of social insurance;
iii) Any travelling allowance or the value of any travelling concession;
iv) Any sum paid to the person employed to defray special expenses entailed on him
by the nature of his employment; or
v) Any gratuity payable on discharge.
Employer: The term ‘employer’ means any person who employs one or more
employees in any scheduled employment in respect of which minimum rates of wages
have been fixed under the Act. The term ‘employer’ also includes:
l Manager of a factory as defined under the Factories Act, 1948.
l Head of department or any person appointed for the supervision and control of
employees or Chief Executive Officer of a local authority in case the scheduled
employment is carried on under Central Government or a local authority.
l In any other case the person responsible for supervision, control or payment of
wages.

1 1

Compensation and Employee: The term ‘employee’ means any person who is employed for hire or
Reward Management reward to do any work, skilled or unskilled, manual or clerical, in a scheduled
employment.

Fixing of Minimum Rates of Wages
When, in respect of an employment, the appropriate government has fixed and notified
minimum rates of wages, the employer is bound to pay every employee engaged in
that employment at rates not less than the rates notified.
The appropriate government may review wages at such intervals as they think fit but
not exceeding five years, and revise them, if necessary.
The appropriate government may refrain from fixing minimum rates of wages in
respect of any scheduled employment in which less than 1000 employees are employed
in the whole State.
The minimum rates of wages may be fixed:
i) For different employments
ii) For different classes in the same employment
iii) For adolescents, children and apprentices
iv) For different localities.
The rates of wages may be:
i) A time rate
ii) A piece rate
iii) A guaranteed time rate
iv) An overtime rate.
The rates may be fixed by the hour, by the day or by the month or by any other longer
period as may be prescribed. The rate fixed may consist of the basic rate of wages and
cost of living allowance and the cash value of concessions in respect of supply of
essential commodities at concessional rates.
In fixing or revising the minimum wages, the appropriate government shall either:
a) Appoint as many committees and sub-committees as it considers necessary to
hold enquiries and advise it in respect of such fixation or revision, as the case
may be; or
b) By notification in the Official Gazette, publish its proposals for the information
of persons likely to be affected thereby and specify a date, not less than two
months from the date of the notification, on which the proposals will be taken
into consideration.
After considering the advice of the said committee or representations received,
the appropriate government will, by notification in the gazette, fix or revise the
minimum rates of wages. Unless otherwise provided, the decision shall come into
force on the expiry of three months from the date of notification. When fixation is
made on the basis of representations, the appropriate government shall consult the
Advisory Board also. The government is not bound to accept the committee’s
recommendations.
The Act also empowers state governments to constitute Advisory Boards to
co-ordinate the work of different committees and sub-committees and advise the
government on the fixation of minimum wages. Similarly, the Central Government is
empowered to constitute a Central Advisory Board to advise Central and State
1 2
Government, and to co-ordinate the work of the Advisory Boards. These bodies

consist of an equal number of employers’ and employees’ representatives, and of Laws Covering Wages,
independent persons not exceeding one-third of their total strength. The non-official Welfare and Benefits
members hold office for a period of two years, while others hold office during the
pleasure of the government.
The mininum wages payable under the Act are to be paid in cash. But it also provides
for authorisation of payment in kind where the appropriate government considers it
necessary. It may direct the supply of essential commodities at concessional rates by
notifying it in the Official Gazette. Authorised deductions are allowed under the Act.
The appropriate government may fix the number of hours of work, rest day, payment
of overtime in respect of scheduled employments.

Registers, Notices, Abstract and Returns
Every employer is required to maintain:
1) Register of wages
2) Register of

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