Essentials of HRM

Internal Assignment – December 2022 Exam Cycle

1. Sundaram Ltd’ is an electronics company in Chandigarh. The top management plans to open new branches pan India
so they want to create a dynamic human resource department for managing employee functions. You have been appointed
as their VP - HR.

Explain to the top management, what will be the scope of your department in this expansion. Give some examples
in the context of this company.

2. An FMCG company wants to focus on improving the structure of the human resource department. They have hired you
as an HR advisor for this purpose.

Suggest what should be the various activities under the new sub divisions in the HR Department. Elaborate them
with corporate examples.

3. Maria, the HR Head of ‘Aztec Tech Solutions Ltd’ assigned the task of assessing the human resource planning to the
HR Department. However, his team informed him that this assessment is not going well as they had expected.

Keeping this context in mind, answer the following:

a. Explain the process of human resource planning. Give some examples also
b. Discuss the qualitative methods for Human Resource Demand forecasting, that the company can utilize.
Which one do you think is best suited for this company?

Solutions

Page 02 – 03 – Answer to Question No 1

Introduction

Every organization, large or small, uses a variety of capital to make the business work. Capital includes cash,
valuables, or goods used to generate income for a business. No matter the industry, all companies have one thing in
common: they must have people to make their capital work for them through the use of people’s skills and abilities

Human resource management (HRM) is the process of employing people, training them, compensating them, creating
personnel policies and procedures that support business objectives and strategic plans. Central to this mission is fostering a
culture that reflects core values and empowers employees to be as productive as possible and coherent approach to the
effective and efficient management of people in a company or organization such that they help their business gain a
competitive advantage

Role & Scope of Human Resource Department in Expansion

Here ‘Sundaram Ltd’ focuses on expansion through new branches across India and therefore their aim is to create Dynamic
Human Recourse Department for managing employee functions as it plays a crucial role in managing various facets of
business functions

HR department is responsible for overseeing Employee-Benefits, Employee Recruitment, Training & Development,
Performance Appraisal, and Reward Management and also concerns itself with Organizational Change and Industrial
Relations, while balancing of Organizational practices with requirements arising from collective bargaining and
governmental laws

● Talent Acquisition is the first step to manage the human capital requirements of an organization and specialize in
Sourcing, Recruiting and Staffing the human resource across the new branches by selection of potential employees done
through Interviewing, Applications, Networking, Attracting talented recruits that meet the organization's requirements,

● Recruitment is the second step where HR Managers at Sundaram Ltd must create detailed recruitment strategies and
have a plan of action to put forward when recruiting. Next, managers can put strategies into place through hiring resources,
by extending out to find the best possible recruits for the team to fill the positions across all the new branches

● Training & Development is the next step and involves a continuous process of training and developing competent and
adapted employees. Once we have spent the time to hire new employees, we want to make sure they not only are trained to do
the job but also continue to grow and develop new skills in their job through regular Training programs, Performance
Appraisals. This results in higher productivity for the organization and plays a key component in employee motivation which
results in increased employee retention

● Performance Management is meant to help the organization train, motivate and reward workers. It is also meant to ensure
that the organizational goals are met with efficiency. The process not only includes the employees but can also be for a
department, product, and service or customer process; automated performance management system (PMS) that carries all
the information to help managers evaluate the performance of the employees and assess them accordingly on their
training and development needs.

● Compensation and Benefits includes developing Compensation structures, Parental leave programs, Discounts, and
other Benefits for employees. HR Department need to determine that compensation is fair, meets industry standards, and is
high enough to entice people to work for the organization

● Employee Motivation: Motivation of employees is essential for retention and sustenance of employees within the
organisation. Motivation plays an important role in management of personnel. It helps to improve productivity of personnel.
There are different ways by which employees may be encouraged. Recognition and reward for performance, promotion, pay-
hike, and other monetary and non-monetary rewards motivate the employees.
● Workplace Policies deals with concerns of employees when policies are broken, such as cases involving Harassment or
Discrimination, Discipline Policy, Ethics policy, Leave Policies etc. and hence every organization has policies to ensure
fairness and continuity within the organization. One of the jobs of HRD is to develop the verbiage surrounding these policies
and recognize the need for a policy or a change of policy, seek opinions on the policy, write the policy, and then
communicate that policy to employees.

● Employee Retention a comprehensive employee retention program can play a vital role in both attracting and retaining key
employees, as well as in reducing turnover and its related costs. All of these contribute to an organization's productivity and
overall business performance. It is more efficient to retain a quality employee than to recruit, train and orient a replacement
employee of the same quality.
● Employee Welfare: Human resource department must focus on the welfare of employees by providing canteen facilities,
rest and lunch rooms, housing, transport, medical assistance, education, health and safety thus it aims at improving the quality
of work life by providing a better environment worth working, job security, flexible working hours, eliminating workplace
hazards, which will have a positive impact on the productivity and quality of work

● Industrial Relations : Labour unrest, conflicts between the work groups and between workers and management over
issues like low wage, bad work environment are common problems that must be handled carefully by establishing a balance
between the worker’s interest and interest of the organisation and management. Human resource department considers
establishment and maintenance of harmonious and cordial relation between employer and employees

● Personnel Research and Information System: Organizations require information about their human resources and their
functioning, but also require information from their external environment. Thereby, HRIS allows us to collect, store,
manipulate, analyse, retrieved, focused on collect and store personal data (records) of each employee, handle their
salaries, benefits, vacations, etc that the system provide information for performance appraisal and management, team and
project management resume processing, recruitment and retention, training and skills testing, and management development

With dynamic changes in the world today, the scope of human resource management needs to be widespread and needs to
evolve to suit the organization’s current needs. It won’t be wrong to say that to win in the market, one has to win in the
workplace, and the key to that is implementing a strong and adaptable human resource management function.

New HR Department can also ensure that clear changes are made to recruitment and capability-building processes by
determining the characteristics of a “purpose driven” employee and embedding these attributes within recruitment,
development, and succession planning.

New HR Department can also incorporate purpose-driven metrics into compensation and performance decisions.
Companies across industries have embarked on these metrics lately

New HR Department can also create better employee experience means a better bottom line. Successful organizations
work together with their people to create personalized, authentic, and motivating experiences that tap into purpose to
strengthen individual, team, and company performance.

New HR Department will evaluate personnel policies and programmes but also highlights the need and areas of
change with the employment (union-management) relations, joint consultation, disciplinary procedures, solving
problems with mutual efforts, understanding human behaviour and maintaining work relations, collective bargaining
and settlement of disputes.

Corporate Examples: Airbnb, for instance, rebranded the CHRO role as global head of employee experience. PayPal
focused on HR’s capability and processes to create a better experience for employees, including coaching HR
professionals on measuring and understanding that experience, and using technology more effectively.

Conclusion: The scope of HR Department in the modern times is very wide and ever growing. In the changing
environment, all organizational systems have become a part of global village. Path breaking researches in behavioural
sciences have enabled us to use new techniques of recruiting, compensating, training and developing the human
resource this element ensures a reliable and full proof HR information base.

1. Personalized Review System: Having a hyper-personalized performance review system. This consists of scrapping out the
outdated yearly reviews for real-time performance reports and personalized coaching. Additional, employees will become the
focus of consideration and their ‘uniqueness’ will have to be recognized.

2. Storytelling learning: HR department with hold the modern tools and technologies will pile the brand into the culture and
help candidates get a well understanding of what their experience would be like, should they join the firm or not. This is done
by showcasing wins, highlighting community involvement, engaging the audience with a reliable message and character
across all social media platforms.

3. Learning and Implementing New Technologies: Human resource departments have largely been tasked with selecting,
learning, and implementing those new technology systems, which means they have had to become IT specialists and/or align
themselves more closely with IT departments.

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Introduction

Transformation of Human Resources in India

In recent years, HR Department has undergone dynamic shifts in its roles, functions and overall impact in shaping
organizations, Modern era witnesses continuous notable developments relating to human resources in modern perspective
comprise – (i) Substantial change in the composition of labour force with the entry of a large number of educated and
highly skilled workers with specialisation, (ii) Greatly improved status of all categories of employees, (iii) Extensive
state intervention in the domain of human resources, (iv) Development of liberal attitude of employers towards
employees with major attention on human aspects, (v) Enhancement of strength and status of unions, and (vi)
Growing international deliberations and exchanges in human resources matters

FMCG companies in India, such as HUL gives intensive focus on the maintenance of brand of employers. The brand of
employers can be maintained if a company can attract and retain best talents. For ensuring employee branding in FMCG
industry, the organizations’ have been giving utmost level of importance to the innovation, such as Procter & Gamble
Heinz and HUL have been giving importance to hiring right people for the right positions.
Concept & Application
In this case the FMCG organization has been facing few challenges, such as management of knowledge workers. The HR
functions have been focusing on the development of the sense of commitment in sales force so that it can contribute to the
development of organization in terms of financial profitability. The HR functions in FMCG industry have been giving focus
on building up effective training and development programs so that efficient sales force can be developed for improving
business performance
Structuring of Human Resource Department: HR department has replaced the traditional concept of labour welfare and
personnel management. HRD in its present form has evolved from a number of significant inter-related developments, this
approach recognises human factor as the most important instrument of success in an organisation. Fast changing
technological developments, however, necessitated new skill development and training of employees.

Activities under new sub division of new HR Department

1. Personnel Transaction Management: Also referred to as Personnel Administration or Transactional Personnel work.
This kind of administration deals intensively with the relationship between employees and the company. Objective of
personnel management is maintaining and being able to provide up-to-date, accurate personnel data. This ensures optimal
internal communication within the company. Additionally, efficient administrative work is a prerequisite for smooth internal
cooperation

● Centralised Time Keeping ●Benefits Administration ● Analysis and tracking of HR metrics ● Payroll Management

Speed in managing HR data is the key to success. Organizations desperately try to reduce precious time spent on tracking and
managing this data. Eliminating administrative tasks and standardizing processes drives efficiency and allows for the
execution of business strategies, as the number of employees in an organization starts growing, the task of managing them
and their data becomes difficult. Sensitive workforce information stays scattered in multiple folders and locations. Integration
is much of a manual task. Benefits, Payroll Management, Engaging Candidates, Attendance Tracking, Etc.

Nestle offers no. of benefits to their employees to fulfil their expectation like Health insurance for his and his family
members, PF, reimbursements (Car, Phone) etc. Take all the necessary steps for the protection of the employees
during work with Nestle.

2. Staffing Management: Staffing may be defined as the process of hiring and developing the required personnel to fill in
the various positions in the organization. It involves estimating the number and type of personnel required. It involves
estimating the number and type of personnel required, recruiting and developing them, maintaining and improving their
competence and performance. ● Recruitment ● Selection ● Hiring ● Transfers and Promotions

Proper staffing ensures the following benefits to the organisation: (i) Helps in discovering and obtaining competent
personnel for various jobs; (ii) Makes for higher performance, by putting right person on the right job; (iii) Ensures
the continuous survival and growth of the enterprise through the succession planning for managers

Nestle HR policy- The Company incorporates practices like Job Enrichment and Job Enlargement, to motivate
employees and to break the monotony of their job tasks. The correspondent herself works in both sales and brand
management departments, which is an example of job enlargement.
3. Organisational Development in HR involves changes and improvement of the processes and structures that are part of
HR’s responsibility. These include processes and systems related to performance management, talent management, diversity,
employee wellness, and so on

●Talent Management ● Assistance &Referral ● Performance & Discipline ● Equal Employment Opportunity.

● Recruiting highly skilled resources apt for current and future needs with diversified talents.
● Develop a process to analyse and improve existing talents to comprehend their weakness and sharpen strengths.
● Demand improvement or design an exit plan to make way for like-minded.

‘Nestle Idea Award’- It was found from the correspondent that the company institutes Nestle Idea Award every
quarter to recognize and award employees who come up with relevant and innovative ideas which have the potential
of being implemented at Nestle.

4. Ethics & Labour basically deals with the affirmative moral obligations of the employer towards employees to maintain
equality and equity justice While Labour relations is the term used to define the process between employers and employees,
management and unions in order to make decisions in organizations.

●Labour relations ●Labour contract administration ●Ethical conduct ●Regulatory and statutory requirements

 Employee turnover is less than 5%., which is considered to be very low for a Multinational Corporation.
 Nestle has an open culture & upward communication especially in case of grievance redressal.
 Work/Life balance is given importance, as illustrated in the Nestle Human Resource Policy document.
 Nestle Family annual events are organized by their HR department whereby employees along with their families are
invited.

5. Training and development is an attempt to improve the current or future employee performance by increasing an
employee’s ability to perform through learning, usually by changing the employee’s attitude or increasing his or her skills and
knowledge. Thus jobs have become more complex and the importance of employee training has increased as it helps both the
organisation and the individual.

● Corporate learning ● Mandatory certification training ● Leadership conferences

Specific job training programmes like Technical training at a training with live demos, Training via the rotation of job,
Group Discussions, Case studies, Role-playing, Conferences, Programmes to identify potential executives, Sensitivity
training to understand and influence employee behaviour, Programmes for improving communication

Nestle provides the following - Literacy training-to upgrades essential literacy skills, especially for workers who
operate new equipment (‘Mission-directed Work Team Approach’). Employees are also sent abroad to study markets,
consumer tastes etc.

Recommendations

 The FMCG organization should focus on the implementation of democratic and participative style of leadership so
that the employees can be able to participate in the decision-making process.

 The FMCG organization should focus on the implementation of 360-degree performance appraisal system so that the
performance can be monitored in an effective manner.

 The FMCG organization can be recommended to appoint change agent so that the cross- functional capabilities can
be developed along with the implementation of organisational change and development system.
Conclusion: In FMCG organisations, the role of HR cannot be denied when it comes to the matter of developing leadership.
The organisations like Procter & Gamble and Nestle have been giving diametrical focus on the development of leadership
qualities amongst the people associated with marketing activities. Through the effective implementation of above-
mentioned recommendations, The organization of FMCG industry will be able to develop their cross-functional
capabilities through the effective implementation of change management. Through the development of effective cross
functional capabilities and will be able to develop their organisational productivity level

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Systematic planning for your company's future requires to involve plans for retaining its quality employees, anticipating
requirements for additional staff and recruiting knowledgeable, skilled talent. Proper planning of human resource enables
employees to work in roles that suit their abilities, ensures work satisfaction, and contributes towards the company's long-
term business success.

The most important aspect of a thriving business is capitalizing on the prospects of the people that work for it, and fully
utilizing the human resources. To harness the full potential of your team member network, and avoid situations such as staff
shortages, human resource planning is extremely crucial

Furthermore we will understand what human resource planning is and its importance for the continued well-being of the
business. We also discuss its process and learn about the tools necessary for developing and implementing the plans.

Concept & Application

Human resource planning is concerned with assessing a company's current human resources, identifying its future
staff requirements and arranging for skills training for its current, new and future employees. These requirement
include the number of people needed to perform a particular job, the skills and abilities of potential employees, etc. The main
objectives of HRP are to fill vacant job positions, meet organisational goals in the given time, and achieve the desired level of
performance.
Moreover, Human resource planning includes creating an employer brand, retention strategy, absence management
strategy, flexibility strategy, (talent management) strategy, (recruitment) and selection strategy which enables an
organisation to ensure that the right people with the right skills for placed at the right job positions.
HR demand forecasting is the main component of HRP without which the whole planning process may lead to a failure. HR
demand fore casting is a process of predicting the right size of manpower in an organisation. Thus, it prevents the situations
of manpower surplus and shortage.
In addition, demand forecasting enables an organisation to cope with changes in the level of competition, technology,
government regulations, etc. Such changes lead to changes in job content, skills, and demand for human resource. In this
chapter, you will study about HRP, its need, and objectives in detail.
HRP Process: Organizations must be able to adapt their human capital to sustain the continuous shifts in technology, local
and global economics, product innovation, and culture. Human resource planning is integral to maximizing a well-equipped
workforce, and it offers other advantages that assist in accomplishing your organization’s mission.
1) Analyse organizational objectives and plans: Each department will have unique objectives that HR will need to be
involved in. Ideally, HR works very closely with management and has a clear grasp of what every area of the company is
aiming for. Once you know that, you can ascertain how HR will meet those needs. For example, some departments may
need you to focus on recruiting, while others may need to be downsized and reassign some current employees.

2) Evaluate the current state of your workforce and uncover gaps: From the updated human resource information storage
sys-tem, the current number of employees, their capacity, perfor-mance and potential can be analysed. To fill the various job
requirements, the internal sources (i.e., employees from within the organization) and external sources (i.e., candidates from
various placement agencies) can be estimated. For example internal factors like promotions, retirement plans, layoffs,
and transfers, as well as anything else that affects a company’s future requirements, External factors influencing
labour demand, such as technological advances that may affect the requirement for employees, can also be examined
by the HR department.

3) Balancing manpower demand and supply: Forecasting work opportunities is the third phase in the HRP process. HR
provides a bridging analysis to identify precise requirements for narrowing the company’s labour supply against future
demand. This type of study is frequently used to answer questions like whether workers need to learn new skills, if the
organization needs additional managers, whether all employees are using their abilities in their existing jobs, and so
on.

4) Implementing and monitoring the HR plan: The solutions to the preceding step’s questions aid HR in determining
how to continue in the HRP process’s last phase, after implementing the human resource plan, you would require to
monitor it and get feedback from the department heads in your company. You would require to make sure that the plan is
fulfilling your requirements for human resources allocation, employee training, budgeting and inventory updates. You are
also required to plan on taking the appropriate actions in case of deficiencies.
Human Resource Demand Forecasting

HR plans depend heavily on forecasts, expectations, and anticipation of future events, to which the requirements of staffing in
terms of quality and quantity are directly linked. Uncertainty adds complexity of forecasting

HR Demand forecasting is the process of assessing and forecasting how many people are needed, their age structure, their
professional structure, their educational level structure, their professional and technical post structure, and their skill structure
in the future with an aim to meet organisational goals and objectives and it is an essential component of HRP

Qualitative methods are less statistical in nature and are based on emotions, intuitions, judgments, personal
experiences, and opinions. The quality of employees required for a job can be determined only after determining the
job requirements and which will attempt to reconcile the interests, abilities and aspiration and individual employees
with the current and future staffing needs of an organization but it rely on experts who assist in preparing forecasts to
anticipate staffing requirements

1) Expert Forecast: Expert forecasts: Sometimes HR personnel seek inputs from professional HR experts regarding future
staffing requirements of their organisations. These experts forecast an organisation's human resource requirements, skills
required to meet organisational goals and objectives, experience required, etc. Here, it should be noted that these HR experts
can be internal or external to an organisation.

2) Management forecasts Sometimes the members of top management sit together and determine the needs on the advice of
personnel department. The forecasts so prepared sent for review to the departmental heads and after their consent approved
the need. This is known as ‘top down’ approach. The best way is the combination of the two approaches. Executives at both
levels equipped with guidelines sit together and determine the human resources need of the organization.

3) Delphi technique: This is one of the most effective methods of forecasting human resource demand. The agreement of a
group of experts in consensus is required to conclude in the Delphi method. This method involves a discussion between
experts on a given problem or situation. An argument or brainstorming is done to complete that everyone involved in the
debate agrees to. This process keeps continuing until all experts agree on the estimated human resource requirements. The
Del phi technique attempts to reduce subjectivity in forecasting and is suitable for organisations where frequent technological
changes largely affect staffing needs.

Suggestion: Management forecast method is the most suitable for Aztec Tech Solutions Ltd’ because they do not
afford to under this method the executives sit together and determine the future manpower requirements of the
enterprise and submit the proposal to the top management for approval.

Conclusion

Human resources planning & forecasting processes need to be an ongoing activity that is constantly evaluating and
developing to stay in sync with all the changes companies must face. Due to increased focus on outsourcing and offshore,
globalisation, and other factors, the future of human resource planning is highly complicated.

Companies must be nimble in their responses to shifting market trends, and doing so can only be accomplished via prudent
HR Demand forecasting must consider several factors-both external well as internal. Among the external factors are
competition (foreign and domestic), economic climate, laws and regulatory bodies, changes in technology, and social
factors. Internal factors include budget constraints, production levels, new products and services, organizational
structure, and employee separations.

In the final stage, the HR planner has to balance out the demand and supply gap. The closer the gap the better it is for the
organisation when it actually goes into procuring. Now it will be visible that how we can utilize the data we have collected in
the last two stages. The human resource requirements thus identified are translated into a concrete manpower plan,
backed up by detailed policies, and other human resources instruments and strategies for example, recruitment,
selection, training, promotion, retirement, replacement, etc.

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