Human Resource Management

Course Topics

  • Introduction of HRM

Introduction of HRM


Unit - I


In all activities men and resources are involved. For a long time men or workers were taken for granted. Greater accent was given to resources, production machinery and top managers. But at present in the modern large scale production of innumerable products with a wide market, (where sky is the limit) in the last few decades the importance of human resources and their development has come to the fore. The importance of human resources to any organization need not be over-emphasized. Human resource is the wealth of a nation and an organization. The development process is wide and varied. In this lesson, let us understand the importance and concept of Human Resources Management.(HRM).

Sumantra Ghosal considers human resources as human capital. He classifies human capital into three categories – intellectual capital, social capital and emotional capital. Intellectual capital consists of specialized knowledge, tacit knowledge and skills, cognitive complexity and learning capacity. Social capital is made up of network of relationships, sociability, and trustworthiness. Emotional capital consists of self-confidence, ambition and courage, risk-bearing ability and resilience”. In simple words, HRM are a process of making the efficient and effective use of human resources so that the set goals are achieved.


According to flippo-“human resource management is the planning, organizing, directing, controlling of the procurement, development ,compensation, integration, maintenance and reproduction of human resources to the end that individual ,organizational and social objectives are accomplished”

The National Institute of Personal Management (NIPM) of India has defined human resources – personal management as “that part of management which is concerned with people at work and with their relationship within an enterprise. Its aim is to bring together and develop into an effective organization of the men and women who make up enterprise and having regard for the well – being of the individuals and of working groups, to enable them to make their best contribution to its success”.

According to Decenzo and Robbins, “HRM is concerned with the people dimension” in management. Since every organization is made up of people, acquiring their services, developing their skills, motivating them to higher levels of performance and ensuring that they continue to maintain their commitment to the organization is an essential to achieve organizational objective. This is true, regardless of the type of organization –government, business, educa tion, health or social action”.

Human Resource Management (HRM) is the function within an organization that focuses on recruitment of, management of, and providing direction for the people who work in the organization. HRM can also be performed by line managers.

HRM is the organizational function that deals with issues related to people such as compensation, hiring, performance management, organization development, safety, wellness, benefits, employee motivation, communication, administration, and training.


1. To help the organization reach its goals: HR department, like other departments in an organization, exists to achieve the goals of the organization first and if it does not meet this purpose, HR department (or for that matter any other unit) will wither and die.

2. To employ the skills and abilities of the workforce efficiently: The primary purpose of HRM is to make people’s strengths productive and to benefit customers, stockholders and employees.

3. To provide the organization with well-trained and well-motivated employees: HRM requires that employees be motivated to exert their maximum efforts, that their performance be evaluated properly for results and that they be remunerated on the basis of their contributions to the organization.

4. To increase to the fullest the employee’s job satisfaction and self-actualization: It tries to prompt and stimulate every employee to realize his potential. To this end suitable programmes have to be designed aimed at improving the quality of work life

5. To develop and maintain a quality of work life: It makes employment in the organization a desirable, personal and social, situation. Without improvement in the quality of work life, it is difficult to improve organizational performance.

6.To communicate HR policies to all employees: It is the responsibility of HRM to communicate in the fullest possible sense; tapping ideas, opinions and feelings of customers, non-customers, regulators and other external public as well as understanding the views of internal human resources

7. To be ethically and socially responsive to the needs of society: HRM must ensure that organizations manage human resource in an ethical and socially responsible manner through ensuring compliance with legal and ethical standards




1. Pervasive force: HRM is pervasive in nature. It is present in all enterprises. It permeates all levels of management in an organization

2. Action oriented: HRM focuses attention on action, rather than on record keeping, written procedures or rules. The problems of employees at works are solved through rational policies.iii.

3. Individually oriented: It tries to help employees develop their potential fully. It encourages them to give their best to the organization. It motivates employees through a systematic process of recruitment, selection, training and development coupled with fair wage policies.


5. future-oriented: Effective HRM helps an organization meet its goals in the future by providing for competent and well-motivated employees.

 6. 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 improves 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.

7. 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.

8. Comprehensive function: HRM is, to some extent, concerned with any organizational decision which has an impact on the workforce or the potential workforce. The term ‘workforce’ signifies people working at various levels, including workers, supervisors, middle and top managers. It is concerned with managing people at work. It covers all types of personnel. 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 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”.

9. 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.

10. 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 and appreciate the contributions of all such ‘soft’ disciplines.


The scope of HRM is very wide. Research in behavioral sciences, new trends in managing knowledge workers and advances in the field of training have expanded the scope of HR function in recent years. The Indian Institute of Personnel Management has specified the scope of HRM thus:

i. Personnel aspect: This is concerned with manpower planning, recruitment, selection, placement, transfer, promotion, training and development, lay off and retrenchment, remuneration, incentives, productivity, etc.

ii. Welfare aspect: It deals with working conditions and amenities such as canteens, creches, rest and lunch rooms, housing, transport, medical assistance, education, health and safety, recreation facilities, etc.

iii. Industrial relations aspect: This covers union-management relations, joint consultation, collective bargaining, grievance and disciplinary procedures, settlement of disputes, etc.


At the enterprise level:

1. It can help in attracting and retaining the best people in the organization.

2. It helps in training people for challenging roles right attitudes towards job and company.

At the individual level:            

1. It promotes team work and team sprit among employees

2. It offers excellent growth opportunities to people who have the potential to rise.

3. It allows people to work with commitment

At the society level:

1. Employment opportunities multiply

2. Scare talents are put to best use

At the national level:

1. Efficient use of human resources

2. Proper use of peoples and resources help the nation to get ahead.

3. It increases standard of living and better employment.