Human Resource Management

Human resource (or personnel) management, in the sense of getting things done through people.
It's an essential part of every manager's responsibilities, but many organizations find it
advantageous to establish a specialist division to provide an expert service dedicated to ensuring
that the human resource function is performed efficiently.

"People are our most valuable asset" is a cliché which no member of any senior management
team would disagree with. Yet, the reality for many organizations is that their people remain

 under valued
 under trained
 under utilized
 poorly motivated, and consequently
 perform well below their true capability

The rate of change facing organizations has never been greater and organizations must absorb
and manage change at a much faster rate than in the past. In order to implement a successful
business strategy to face this challenge, organizations, large or small, must ensure that they have
the right people capable of delivering the strategy.

The market place for talented, skilled people is competitive and expensive. Taking on new staff
can be disruptive to existing employees. Also, it takes time to develop 'cultural awareness',
product/ process/ organization knowledge and experience for new staff members.

As organizations vary in size, aims, functions, complexity, construction, the physical nature of
their product, and appeal as employers, so do the contributions of human resource management.
But, in most the ultimate aim of the function is to: "ensure that at all times the business is
correctly staffed by the right number of people with the skills relevant to the business needs",
that is, neither overstaffed nor understaffed in total or in respect of any one discipline or work
grade.

Functional overview and strategy for HRM

These issues motivate a well thought out human resource management strategy, with the
precision and detail of say a marketing strategy. Failure in not having a carefully crafted human
resources management strategy, can and probably will lead to failures in the business process
itself.

This set of resources are offered to promote thought, stimulate discussion, diagnose the
organizational environment and develop a sound human resource management strategy for your
organization. We begin by looking at the seven distinguishable function human resource
management provide to secure the achievement of the objective defined above.

Following on from this overview we look at defining a human resource strategy.

Finally, some questions are posed in the form of a HRM systems diagnostic checklist for you to
consider, which may prove helpful for you to think about when planning your development
programs for the human resources in your organization, if they are truely "your most valuable
asset."

Function 1: Manpower planning

The penalties for not being correctly staffed are costly.

 Understaffing loses the business economies of scale and specialization, orders, customers and
profits.
 Overstaffing is wasteful and expensive, if sustained, and it is costly to eliminate because of
modern legislation in respect of redundancy payments, consultation, minimum periods of
notice, etc. Very importantly, overstaffing reduces the competitive efficiency of the business.

Planning staff levels requires that an assessment of present and future needs of the organization
be compared with present resources and future predicted resources. Appropriate steps then be
planned to bring demand and supply into balance.

Thus the first step is to take a 'satellite picture' of the existing workforce profile (numbers, skills,
ages, flexibility, gender, experience, forecast capabilities, character, potential, etc. of existing
employees) and then to adjust this for 1, 3 and 10 years ahead by amendments for normal
turnover, planned staff movements, retirements, etc, in line with the business plan for the
corresponding time frames.

The result should be a series of crude supply situations as would be the outcome of present
planning if left unmodified. (This, clearly, requires a great deal of information accretion,
classification and statistical analysis as a subsidiary aspect of personnel management.)

What future demands will be is only influenced in part by the forecast of the personnel manager,
whose main task may well be to scrutinize and modify the crude predictions of other managers.
Future staffing needs will derive from:

 Sales and production forecasts

 The effects of technological change on task needs
 Variations in the efficiency, productivity, flexibility of labor as a result of training, work study,
organizational change, new motivations, etc.
 Changes in employment practices (e.g. use of subcontractors or agency staffs, hiving-off tasks,
buying in, substitution, etc.)
 Variations, which respond to new legislation, e.g. payroll taxes or their abolition, new health and
safety requirements
 Changes in Government policies (investment incentives, regional or trade grants, etc.)

What should emerge from this 'blue sky gazing' is a 'thought out' and logical staffing demand
schedule for varying dates in the future which can then be compared with the crude supply
schedules. The comparisons will then indicate what steps must be taken to achieve a balance.
That, in turn, will involve the further planning of such recruitment, training, retraining, labor
reductions (early retirement/redundancy) or changes in workforce utilization as will bring supply
and demand into equilibrium, not just as a one–off but as a continuing workforce planning
exercise the inputs to which will need constant varying to reflect 'actual' as against predicted
experience on the supply side and changes in production actually achieved as against forecast on
the demand side.

Function 2: Recruitment and selection of employees

Recruitment of staff should be preceded by:

An analysis of the job to be done (i.e. an analytical study of the tasks to be performed to
determine their essential factors) written into a job description so that the selectors know what
physical and mental characteristics applicants must possess, what qualities and attitudes are
desirable and what characteristics are a decided disadvantage;

 In the case of replacement staff a critical questioning of the need to recruit at all (replacement
should rarely be an automatic process).
 Effectively, selection is 'buying' an employee (the price being the wage or salary multiplied by
probable years of service) hence bad buys can be very expensive. For that reason some firms
(and some firms for particular jobs) use external expert consultants for recruitment and
selection.
 Equally some small organizations exist to 'head hunt', i.e. to attract staff with high reputations
from existing employers to the recruiting employer. However, the 'cost' of poor selection is such
that, even for the mundane day-to-day jobs, those who recruit and select should be well trained
to judge the suitability of applicants.

The main sources of recruitment are:

 Internal promotion and internal introductions (at times desirable for morale purposes)
 Careers officers (and careers masters at schools)
 University appointment boards
 Agencies for the unemployed
 Advertising (often via agents for specialist posts) or the use of other local media (e.g.
commercial radio)

Where the organization does its own printed advertising it is useful if it has some identifying
logo as its trade mark for rapid attraction and it must take care not to offend the sex, race, etc.
antidiscrimination legislation either directly or indirectly. The form on which the applicant is to
apply (personal appearance, letter of application, completion of a form) will vary according to
the posts vacant and numbers to be recruited.

It is very desirable in many jobs that claim about experience and statements about qualifications
are thoroughly checked and that applicants unfailingly complete a health questionnaire (the latter
is not necessarily injurious to the applicants chance of being appointed as firms are required to
employ a percentage of disabled people).
Before letters of appointment are sent any doubts about medical fitness or capacity (in
employments where hygiene considerations are dominant) should be resolved by requiring
applicants to attend a medical examination. This is especially so where, as for example in the
case of apprentices, the recruitment is for a contractual period or involves the firm in training
costs.

Interviewing can be carried out by individuals (e.g. supervisor or departmental manager), by

panels of interviewers or in the form of sequential interviews by different experts and can vary
from a five minute 'chat' to a process of several days. Ultimately personal skills in judgment are
probably the most important, but techniques to aid judgment include selection testing for:

 Aptitudes (particularly useful for school leavers)

 Attainments
 General intelligence

(All of these need skilled testing and assessment.) In more senior posts other techniques are:

 Leaderless groups
 Command exercises
 Group problem solving

(These are some common techniques - professional selection organizations often use other
techniques to aid in selection.)

Training in interviewing and in appraising candidates is clearly essential to good recruitment.

Largely the former consists of teaching interviewers how to draw out the interviewee and the
latter how to xratex the candidates. For consistency (and as an aid to checking that) rating often
consists of scoring candidates for experience, knowledge, physical/mental capabilities,
intellectual levels, motivation, prospective potential, leadership abilities etc. (according to the
needs of the post). Application of the normal curve of distribution to scoring eliminates freak
judgments.

Function 3: Employee motivation

To retain good staff and to encourage them to give of their best while at work requires attention
to the financial and psychological and even physiological rewards offered by the organization as
a continuous exercise.

Basic financial rewards and conditions of service (e.g. working hours per week) are determined
externally (by national bargaining or government minimum wage legislation) in many
occupations but as much as 50 per cent of the gross pay of manual workers is often the result of
local negotiations and details (e.g. which particular hours shall be worked) of conditions of
service are often more important than the basics. Hence there is scope for financial and other
motivations to be used at local levels.
As staffing needs will vary with the productivity of the workforce (and the industrial peace
achieved) so good personnel policies are desirable. The latter can depend upon other factors (like
environment, welfare, employee benefits, etc.) but unless the wage packet is accepted as 'fair and
just' there will be no motivation.

Hence while the technicalities of payment and other systems may be the concern of others, the
outcome of them is a matter of great concern to human resource management.

Increasingly the influence of behavioral science discoveries are becoming important not merely
because of the widely-acknowledged limitations of money as a motivator, but because of the
changing mix and nature of tasks (e.g. more service and professional jobs and far fewer unskilled
and repetitive production jobs).

The former demand better-educated, mobile and multi-skilled employees much more likely to be
influenced by things like job satisfaction, involvement, participation, etc. than the economically
dependent employees of yesteryear.

Hence human resource management must act as a source of information about and a source of
inspiration for the application of the findings of behavioral science. It may be a matter of
drawing the attention of senior managers to what is being achieved elsewhere and the gradual
education of middle managers to new points of view on job design, work organization and
worker autonomy.

Function 4: Employee evaluation

An organization needs constantly to take stock of its workforce and to assess its performance in
existing jobs for three reasons:

 To improve organizational performance via improving the performance of individual

contributors (should be an automatic process in the case of good managers, but (about
annually) two key questions should be posed:
o what has been done to improve the performance of a person last year?
o and what can be done to improve his or her performance in the year to come?).
 To identify potential, i.e. to recognize existing talent and to use that to fill vacancies higher in
the organization or to transfer individuals into jobs where better use can be made of their
abilities or developing skills.
 To provide an equitable method of linking payment to performance where there are no
numerical criteria (often this salary performance review takes place about three months later
and is kept quite separate from 1. and 2. but is based on the same assessment).

On-the-spot managers and supervisors, not HR staffs, carry out evaluations. The personnel role is
usually that of:

 Advising top management of the principles and objectives of an evaluation system and designing
it for particular organizations and environments.
  Developing systems appropriately in consultation with managers, supervisors and staff
representatives. Securing the involvement and cooperation of appraisers and those to be
appraised.
 Assistance in the setting of objective standards of evaluation / assessment, for example:
o Defining targets for achievement;
o Explaining how to quantify and agree objectives;
o Introducing self-assessment;
o Eliminating complexity and duplication.
 Publicizing the purposes of the exercise and explaining to staff how the system will be used.
 Organizing and establishing the necessary training of managers and supervisors who will carry
out the actual evaluations/ appraisals. Not only training in principles and procedures but also in
the human relations skills necessary. (Lack of confidence in their own ability to handle situations
of poor performance is the main weakness of assessors.)
 Monitoring the scheme - ensuring it does not fall into disuse, following up on training/job
exchange etc. recommendations, reminding managers of their responsibilities.

Full-scale periodic reviews should be a standard feature of schemes since resistance to evaluation
/ appraisal schemes is common and the temptation to water down or render schemes ineffectual
is ever present (managers resent the time taken if nothing else).

Basically an evaluation / appraisal scheme is a formalization of what is done in a more casual

manner anyway (e.g. if there is a vacancy, discussion about internal moves and internal attempts
to put square pegs into 'squarer holes' are both the results of casual evaluation). Most managers
approve merit payment and that too calls for evaluation. Made a standard routine task, it aids the
development of talent, warns the inefficient or uncaring and can be an effective form of
motivation.