MN4123 Human Resource Management and Industrial Relations

LECTURE 1
INTRODUCTION TO HUMAN RESOURCE MANAGEMENT
By
Dr. Nisha Palagolla
27th January 2025

[email protected]
LEARNING OUTCOMES
On successful completion of this lesson, the learner will be able to:

LO1: Define HRM and fundamental concepts.

LO2: Explain the elements of Human Capital.
LO3: Explain the overall purpose & primary objectives of HRM.
LO4: Describe the nature and evolution of HRM.
LO5: Examine different approaches to HRM.
LO6: Discuss outcomes, issues and challenges of HRM.

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 DEFINING HRM
Ø “Decisions and actions which concern the management of
employees at all levels in the business, and which are related to
the implementation of strategies directed towards creating and
sustaining competitive advantage” Miller (1987).

Ø “A strategic, integrated and coherent approach to the

employment, development and well-being of the people working
in organizations” Armstrong (2009).

Ø “The process of acquiring, training, appraising, and compensating

employees, and of attending to their labor relations, health and
safety, and fairness concern” Dessler and Varkkey (2018).

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DEFINING HUMAN CAPITAL

Ø “The combined intelligence, skills and expertise that gives the

organization its distinctive character” Bontis et al. (1999).

Ø “Knowledge and skills which individuals create, maintain, and

use” Armstrong (2006).

Ø “The knowledge, skills, competencies and attributes embodied

in individuals that facilitate the creation of personal, social and
economic well-being”.
Organization for Economic Co-operation & Development

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UNDERSTANDING HUMAN CAPITAL
What do you know? What can you do now?

SKILLS
KNOWLEDGE Strategic decision making,
Laws, policies, procedures, critical analysis,
practices, principles communication, writing,
negotiation, managing
performance & projects

How would you do something? KSAOs What do you possess to do something?

OTHER ABILITIES
CHARACTERISTICS Speed, flexibility, agility,
Good work ethics, work composed, potential,
styles, values, engaging, creativity, managing
loyal, committed relationships

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OVERALL PURPOSE OF HRM

The main purpose of HRM is to improve the

productive contribution of people to the
organization in ways that are strategically,
ethically and socially responsible.

Ø HRM is responsible at:

Ø Personal level
Ø Functional level
Ø Strategic level
Ø Societal level

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PRIMARY OBJECTIVES OF HRM

Acquisition

Planning Development

Human
Capital

Retention Motivation

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PLANNING HUMAN CAPITAL
Strategic Business Objectives

Ø Identifying the right

quality and quantity of Scan Internal
Context
Scan External
Context
people for right jobs at
the right time and cost. Analyzing
Human Capital
needs

Forecasted
Available Human
Human Capital
Capital
needs

HR Strategy

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ACQUISITION OF HUMAN CAPITAL

Ø Onboarding new employees ATTRACTING

(KSAOs) with the organization
to become more effective and
achieve competitive advantage.
HIRING

PLACEMENT

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DEVELOPMENT OF HUMAN CAPITAL
Ø Improving employee competencies and
performance through:

Ø Education
Ø Training
Ø Conferences
Ø Seminars
Ø Workshops
Ø Research
(Including but not limited to)

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MOTIVATION OF HUMAN CAPITAL
Ø Persuading employees towards set objectives by
means of:

Ø Performance & recognition

Ø Compensation
Ø Benefits
Ø Incentives
Ø Work-life balance

(Including but not limited to)

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RETENTION OF HUMAN CAPITAL

Ø Preventing key employee turnover by fostering:

Ø Career ownership and inclusion

Ø Wining incentives
Ø Employer brand
Ø Exceptional work experience
Ø Supportive culture
Ø Health and safety

(Including but not limited to)

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SCOPE OF HRM

HR Department works as a profit center within an organization

Firm’s Firm’s
Strategic HRM Employee Firm
HR Function
Goals Strategy Performance Performance

Job Analysis & Design

Job Evaluation
Recruitment &Selection
Placement & Induction
Performance Evaluation
Training & Development
Rewards Management
Health, Safety & Well-being
Industrial relations
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MULTIDISCIPLINARY NATURE OF HRM

Ø Configuration of Knowledge:
Ø Economics
Ø Management
Ø Law & Ethics
Ø Psychology
Ø Sociology
Ø Communication

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MAIN ERAS OF HRM DEVELOPMENT
A particular approach to HRM is seen in each era which is to
some extent overlapping.

1. Industrial revolution era (18th century)

2. Trade union movement era (Early19th century)
3. Social responsibility era (beginning of the 20th century)
4. Scientific management era (1900 – 1920s)
5. Welfarism and industrial psychology era (1920 – 1930)
6. Human relations era (1930s – 1950s)
7. Behavioral science era (1950s – 1960s)
8. Systems and contingency approach era (1960 onwards)
9. Human resource management era (1980 onwards)
10. Strategic human resource management era (2000 onwards)
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HRM TIMELINE AND NAME CHANGE

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APPROACHES TO HRM

Ø Hard HRM
Ø Soft HRM
Ø Best fit HRM
Ø Best practice HRM

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HARD Vs SOFT APPROACHES TO HRM

Hard HRM Soft HRM

Ø Task oriented Ø Employee engagement

Ø Minimum wages Ø Competitive pay
Ø Cost control Ø Job satisfaction
Ø Employee motivation
Ø Efficiency
Ø Employee & organizational
Ø Organizational goals
development

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BEST FIT HRM

Ø Each business is different.

Ø Each business is at a different stage.
Ø No “one size fits all”.
Ø Best fit is contextual.

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BEST PRACTICE HRM

Ø Each business aims at higher performance.

Ø Higher performance is linked with sets of good
HRM practices.
Ø These sets of best practices can take many forms.
Ø Best practice can be universal.

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DIFFERENT HRM PERSPECTIVES

Ø Senior managers’ perspective Strategic

Perspective
Ø Line managers’ perspective
Ø Employees’ perspective
HRM

Operational Individual
Perspective Perspective

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OUTCOMES OF EFFECTIVE HRM

1) Attaining Strategic Business Objectives:

Ø Managing human capital
Ø Integrating with other functions
Ø Increasing employee performance
Ø Increasing stakeholder satisfaction
Ø Managing change
(Including but not limited to)

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OUTCOMES OF EFFECTIVE HRM

2) Adhering to Professional and Ethical Principles:

Ø Advancing professional development
Ø Advocating professional responsibilities
Ø Maintaining ethical leadership
Ø Fostering fairness and justice
Ø Protecting conflicts of interest
Ø Ensuring proper use of information

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(Including but not limited to)

OUTCOMES OF EFFECTIVE HRM

3. Enhancing employee engagement:

Ø Empowering employees
Ø Fostering greater employee wellness
Ø Fostering better work-life balance
Ø Establishing equal treatment policy
Ø Establishing better grievance handling mechanism

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(Including but not limited to)

MAIN ISSUES IN HRM

Ø Increased competition
Ø Aging workforce
Ø Managing change/transition
Ø Skills and labour shortage
Ø High turnover/low retention
Ø Workforce planning
Ø Social concerns/changes
Ø Work-life balance
Ø Rapid development of technology
Ø Disciplinary issues
Ø Workforce diversity
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KEY CHALLENGES IN HRM

Ø Global economic competition

Ø Technological and communication breakthroughs
Ø Demand for personal flexibility
Ø Skills convergence in a multi-disciplinary environment
Ø Global best practice changes
Ø Changing business standards
Ø Government regulations
Ø Political influence

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SUMMARY

Ø HRM is the effective management of people in an organization which helps

to bridge the gap between employee performance and organization’s
strategic business objectives.
Ø Human Capital is the stock of knowledge, skills, abilities and other
characteristics of the workforce which is thus the backbone of any business.
Ø The main objectives of HRM are to plan, acquire, develop, motivate and
retain human capital for which HR functions are put in place.
Ø HRM does not operate in a vacuum instead interconnected with internal and
external factors thus HRM demands knowledge in different disciplines.
Ø There is no one-fits-all approach to HRM instead different models and
perspectives of HRM are in practice.
Ø HR managers are to be proactive for dealing with HRM issues and
challenges.
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REFERENCES

Ø Armstrong, M. (2009) Armstrong’s Handbook of Human

Resource Management Practice. 11th Edition, Kogan Page
Limited, London.
Ø Boxall, P., Purcell, J. and Wright, P. (2007). The Oxford
Handbook of Human Resource Management. Oxford: OUP .
Ø Gibb, S. (2007). Human Resource Development: Processes,
Practices and Perspectives. Basingstoke: Palgrave.
Ø Marchington, M. & Wilkinson, A. (2011). Human Resource
Management at Work: People Management & Development.
5th Edition. London: CIPD.
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NEXT LECTURE

Ø Date: 03 February 2025

Ø Time: 3.15 – 5.15 pm
Ø Topic: Role of the HR Function and Practitioner

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