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Objectives and Functions of HRM

Human Resource Management is very challenging because of the dynamic nature

of the people and it is not only managing men but inv1olves administering a social

According to Dale Yoder Man power management is the function or activity in

directing working men and women in maximizing their satisfaction in

George R. Terry says, Personnel management is concerned with the obtaining

and maintaining of a satisfactory and satisfied work force.


1. Social Objectives:

a) Facing the challenge of unemployment and providing people

withmaximum employment opportunities is the first and foremost priority of
countries like India where there is pressure of population growth.

b) The employees must be able to derive maximum satisfaction from the work

c) The system should facilitate harmony and co-operative endeavor for one and all.

2. Personal Objectives:

Job satisfaction and rewards in the form of pay, promotion and recognition is aimed
at, on the part of employees. This can be achieved by providing adequate
remuneration, opportunities for advancement, facilities for training and
development, job security and proper work.

3. Enterprise Objectives:

This can be achieved by selecting the right people for the right job, empowering
them through training, development and participation.


1. Planning: Assessment of future man power requirement is done with the help of
man power inventory chart followed by the recruitment and selection process. A
clean job description is needed to lure people with the right skills for the right
position. It is the responsibility of the manager of a firm to lay down specifications of
the qualities and skills required by the workers and determining sources from
where the workers are to be recruited. Selection is done by means of written test
and personal interviews.

2. Organizing: This involves proper designing of organizational structure, the inter

relationship between jobs, establishing smooth channels of communication,
assignment of authority, responsibility and creating accountability, establishing line
and staff relationship etc.

3. Directing: Issuing orders and instructions down the line and motivating the work
force to carry out those instructions satisfactorily. Positive motivation in the form of
financial and non-financial incentives, a good working environment is essential on
the part of the management.
4. Controlling: The motive is to ensure that performance of each worker coincides
with the plans or standards. Bench marking, Total quality management and Six
sigma are some of the popular concepts of standardization.

The operative functions of human resource or personnel department are discussed

1. Employment:

The first operative function of the human resource of personnel department is the
employment of proper kind and number of persons necessary to achieve the objectives of
the organisation. This involves recruitment, selection, placement, etc. of the personnel.

Before these processes are performed, it is better to determine the manpower

requirements both in terms of number and quality of the personnel. Recruitment and
selection cover the sources of supply of labour and the devices designed to select the
right type of people for various jobs. Induction and placement of personnel for their better
performance also come under the employment or procurement function.

2. Development:

Training and development of personnel is a follow up of the employment function. It is a

duty of management to train each employee property to develop technical skills for the job
for which he has been employed and also to develop him for the higher jobs in the
organisation. Proper development of personnel is necessary to increase their skills in
doing their jobs and in satisfying their growth need.

For this purpose, the personnel departments will device appropriate training programs.
There are several on- the-job and off-the-job methods available for training purposes. A
good training program should include a mixture of both types of methods. It is important to
point out that personnel department arranges for training not only of new employees but
also of old employees to update their knowledge in the use of latest techniques.
3. Compensation:

This function is concerned with the determination of adequate and equitable remuneration
of the employees in the organisation of their contribution to the organisational goals. The
personnel can be compensated both in terms of monetary as well as non-monetary

Factors which must be borne in mind while fixing the remuneration of personnel are their
basic needs, requirements of jobs, legal provisions regarding minimum wages, capacity of
the organisation to pay, wage level afforded by competitors etc. For fixing the wage levels,
the personnel department can make use of certain techniques like job evaluation and
performance appraisal.

4. Maintenance (Working Conditions and Welfare):

Merely appointment and training of people is not sufficient; they must be provided with
good working, conditions so that they may like their work and workplace and maintain their
efficiency. Working conditions certainly influence the motivation and morale of the

These include measures taken for health, safety, and comfort of the workforce. The
personnel department also provides for various welfare services which relate to the
physical and social well-being of the employees. These may include provision of cafeteria,
rest rooms, counseling, group insurance, education for children of employees, recreational
facilities, etc.

5. Motivation:

Employees work in the organisation for the satisfaction of their needs. In many of the
cases, it is found that they do not contribute towards the organisational goals as much as
they can. This happens because employees are not adequately motivated. The human
resource manager helps the various departmental managers to design a system of
financial and non-financial rewards to motivate the employees.
6. Personnel Records:

The human resource or personnel department maintains the records of the employees
working in the enterprise. It keeps full records of their training, achievements, transfer,
promotion, etc. It also preserves many other records relating to the behaviour of personnel
like absenteeism and labour turnover and the personnel programs and policies of the

7. Industrial Relations:

These days, the responsibility of maintaining good industrial relations is mainly discharged
by the human resource manager. The human resource manager can help in collective
bargaining, joint consultation and settlement of disputes, if the need arises. This is
because of the fact that he is in possession of full information relating to personnel and
has the working knowledge of various labour enactments.

The human resource manager can do a great deal in maintaining industrial peace in the
organisation as he is deeply associated with various committees on discipline, labour
welfare, safety, grievance, etc. He helps in laying down the grievance procedure to
redress the grievances of the employees. He also gives authentic information to the trade
union leaders and conveys their views on various labour problems to the top

8. Separation:

Since the first function of human resource management is to procure the employees, it is
logical that the last should be the separation and return of that person to society. Most
people do not die on the job. The organisation is responsible for meeting certain
requirements of due process in separation, as well as assuring that the returned person is
in as good shape as possible. The personnel manager has to ensure the release of
retirement benefits to the retiring personnel in time.
3. Advisory Functions:

Human resource manager has specialised education and training in managing human
resources. He is an expert in his area and so can give advise on matters relating to
human resources of the organisation.

He offers his advise to:

1. Advised to Top Management:

Personnel manager advises the top management in formulation and evaluation of

personnel programs, policies and procedures. He also gives advice for achieving and
maintaining good human relations and high employee morale.

2. Advised to Departmental Heads:

Personnel manager offers advice to the heads of various departments on matters such as
manpower planning, job analysis and design, recruitment and selection, placement,
training, performance appraisal, etc.

Scope and Characteristics of HRM

1. Personnel aspect: concerned with manpower planning, recruitment, selection,

placement, transfer, promotion, training and development, lay off and retrenchment,
remuneration, incentives, productivity, etc.;

2. Welfare aspect; dealing with working conditions and provision of amenities such
as canteens, cre ches, rest and lunch rooms, housing,transport, medical assistance,
education, health, safety, recreation facilities, etc.; and

3. Industrial Relations aspect: the legal part which covers union-management

relations, joint consultation, collective bargaining,grievance redress and disciplinary
procedures, settlement of disputes, etc.

1. It is an art and a science:

The art and science of HRM is indeed very complex. HRM is both the art of managing
people by recourse to creative and innovative approaches; it is a science as well
because of the precision and demanding application of theory that is required.

2. It is pervasive:

Development of HRM covers all levels and all categories of people, and management
and operational staff. No discrimination is made between any levels or categories.
All those who are managers have to perform HRM. It is pervasive also because it is
required in every department of the organisation. All kinds of organisations, profit
or non-profit making, have to follow HRM.

3. It is a continuous process:

First, it is a process as there are number of functions to be performed in a series,

beginning with human resource planning to recruitment to selection, to training to
performance appraisal.

To be specific, the HRM process includes acquisition (HR planning,recruitment,

selection, placement, socialisation), development (training and development, and
career development), utilisation (job design, motivation, performance appraisal and
reward management), and maintenance (labour relations, employee discipline,
grievance handling, welfare, and termination). Second, it is continuous, because
HRM is a never-ending process.

4. HRM is a service function:

HRM is not a profit centre. It serves all other functional departments. But the basic
responsibility always lies with the line managers. HRM is a staff function a
facilitator. The HR Manager has line authority only within his own department, but
has staff authority as far as other departments are concerned.

5. HRM must be regulation-friendly:

The HRM function has to be discharged in a manner that legal dictates are not
violated. Equal opportunity and equal pay for all, inclusion of communities in
employment, inclusion of tribals and farmers in the benefits and non-violation of
human rights must be taken care of by the HRM.

6. Interdisciplinary and fast changing:

It is encompassing welfare, manpower, personnel management, and keeps close

association with employee and industrial relations. It is multi- disciplinary activity
utilising knowledge and inputs from psychology, sociology, economics, etc. It is
changing itself in accordance with the changing environment. It has travelled from
exploitation of workers to treating them as equal partners in the task.

7. Focus on results:

HRM is performance oriented. It has its focus on results, rather than on rules. It
encourages people to give their 100%. It tries to secure the best from people by
winning the whole hearted cooperation. It is a process of bringing people and
organization together so that the goals of each are met. It is commitment oriented.

8. People-centred:

HRM is about people at work both as individuals and a group. It tries to help
employees to develop their potential fully. It comprises people-related functions like
hiring, training and development, performance appraisal, working environment, etc.

HRM has the responsibility of building human capital. People are vital for achieving
organizational goals. Organizational performance depends on the quality of people
and employees.

9. Human relations philosophy:

HRM is a philosophy and the basic assumption is that employees are human beings
and not a factor of production like land, labour or capital. HRM recognises
individuality and individual differences. Every manager to be successful must
possess social skills to manage people with differing needs.

10. An integrated concept:

HRM in its scope includes Personnel aspect, Welfare aspect and Industrial relations
aspect in itself. It is also integrated as it concern with not only acquisition, but also
development, utilisation, and maintenance.

Difference between Personnel Management &

Many students of management and laypeople often hear the term HRM or Human Resource Management
and wonder about the difference between HRM and the traditional term Personnel Management.

In earlier times, the Personnel Manager of a factory or firm was the person in charge of ensuring
employee welfare and interceding between the management and the employees. In recent times, the term
has been replaced with HR manager.

This article looks at the differences in usage and scope of functions as well as the underlying theory
behind these nomenclatures. In the section on introducing HRM, we briefly looked at the main
differences. We shall look into them in more detail here.

Personnel Management

Traditionally the term personnel management was used to refer to the set of activities concerning the
workforce which included staffing, payroll, contractual obligations and other administrative tasks. In this
respect, personnel management encompasses the range of activities that are to do with managing the
workforce rather than resources.

Personnel Management is more administrative in nature and the Personnel Managers main job is to
ensure that the needs of the workforce as they pertain to their immediate concerns are taken care of.
Further, personnel managers typically played the role of mediators between the management and the
employees and hence there was always the feeling that personnel management was not in tune with the
objectives of the management.

Human Resource Management

With the advent of resource centric organizations in recent decades, it has become imperative to put
people first as well as secure management objectives of maximizing the ROI (Return on Investment) on
the resources. This has led to the development of the modern HRM function which is primarily concerned
with ensuring the fulfillment of management objectives and at the same time ensuring that the needs of
the resources are taken care of. In this way, HRM differs from personnel management not only in its
broader scope but also in the way in which its mission is defined.

HRM goes beyond the administrative tasks of personnel management and encompasses a broad vision of
how management would like the resources to contribute to the success of the organization.
Personnel Management and HRM: A Paradigm Shift ?

Cynics might point to the fact that whatever term we use, it is finally about managing people. The
answer to this would be that the way in which people are managed says a lot about the approach that the
firm is taking. For instance, traditional manufacturing units had personnel managers whereas the
services firms have HR managers.

While it is tempting to view Personnel Management as archaic and HRM as modern, we have to recognize
the fact that each serves or served the purpose for which they were instituted. Personnel Management
was effective in the smokestack era and HRM is effective in the 21st century and this definitely reflects a
paradigm shift in the practice of managing people.


It is clear from the above paragraphs that HRM denotes a shift in focus and strategy and is in tune with
the needs of the modern organization. HRM concentrates on the planning, monitoring and control aspects
of resources whereas Personnel Management was largely about mediating between the management and

Many experts view Personnel Management as being workforce centered whereas HRM is resource
centered. In conclusion, the differences between these two terms have to be viewed through the prism of
people management through the times and in context of the industry that is being studied.

Role of Human Resource Managers

Humanitarian Role: Reminding moral and ethical obligations to employees.

Counsellor: Consultations to employees about marital, health, mental, physical and career

Mediator: Playing the role of a peacemaker during disputes, conflicts between individuals and
groups or management.

Spokesman: To represent the company in Media and other forums because he has better overall
picture of his companys operations.
Problem Solver: Solving problems of overall human resource management and long-term
organizational planning.

Change Agent: Introducing and implementing institutional changes and installing organizational
development programs.

Management of Manpower Resources: Broadly concerned with leadership both in the group and
individual relationships and labour-management relations.

Recruitment Process
We break recruitments core tasks into seven steps. Your company may break things down differently, but
the work to be done is likely the same. Whats usually not the same is the fact that here at Seven Step RPO,
were focused on trying to get better at all of it, every single day.

A Best Practices Approach to Recruitment Process

Were passionate about best practices. Were constantly exploring, codifying, andsharing new ones: best
practices for generating recruitment results, best practices for becoming more productive in our work,
best practices for offering a higher level of RPO service to our clients.
Seven Step's process is an evolving playbook of recruitment's best practices, a playbook that has seven
Recruitment Process or Recruitment Framework?

Maybe the word process doesnt even apply. If process makes you think of a series of defined
procedures carried out in a strictly regimented order, well, we dont have one of those. What we do have is
an extremely reliable, extremely flexibleframework for delivering state-of-the-art service and results
across the breadth of the recruitment spectrum.
Custom Application for Each RPO Client

Because we work from a recruiting framework and not a rigid process, we can be flexible in
crafting custom RPO solutions for our clients. One clients solution might involve all seven of the
framework steps. Anothers might involve just one or two of them.
The flexibility that's inherent in Seven Steps recruitment framework means we can be super-efficient in
solving each clients unique challenges. We can react and scale rapidly as their needs evolve.

Explore the Seven Steps

Here's a taste of the sort of work involved in each of our framework's seven steps. For a detailed look at
how Seven Step's recruitment framework could be applied toyour hiring needs, just talk to us.
Step 1 Setup

Assess past/ current recruiting Establish advisory relationship with

strategy HM

Design custom recruitment process

Step 2 Source

Building sourcing strategy Search engine optimization of all

Data mining
Targeted social media & event based
Step 3 Screen

Phone-screen candidates Assessment tool recommendation

Behavioral screening Selling the job opportunity

Test and assess

Building a robust referral network

Step 4 Schedule

Schedule interviews Extensive candidate interview

Confirm interviews
Step 5 Feedback

Gather manager feedback Maximize # of YES candidates

Gather candidate feedback HM interview skills analysis &

Step 6 Offer

In depth candidate pre-closure Market research and offer analysis

Negotiate and extend offers
Step 7 Onboard

Conduct background and reference Pre-start welcome session

Post-start follow up
Enroll candidate


1. Internal Factors:

The internal factors also called endogenous factors are the factors within the organisation
that affect recruiting personnel in the organisation. Some of these are mentioned here.

a. Size of the Organisation:

The size of an organisation affects the recruitment process. Experience suggests that larger
organisations find recruitment less problematic than organisations with smaller in size.

b. Recruiting Policy:
The recruiting policy of the organisation i.e., recruiting from internal sources (from own
employees) and from external sources (from outside the organisation) also affects
recruitment process. Generally, recruiting through internal sourcing is preferred, because own
employees know the organisation and they can well fit into the organisations culture.


c. Image of Organisation:
Image of organisation is another internal factor having its influence on the recruitment
process of the organisation. Good image of the organisation earned by a number of overt and
covert actions by management helps attract potential and competent candidates. Managerial
actions like good public relations, rendering public services like building roads, public parks,
hospitals and schools help earn image or goodwill for the organisation. That is why blue chip
companies attract large number of applications.
d. Image of Job:
Just as image of organisation affects recruitment so does the image of a job also. Better
remuneration and working conditions are considered the characteristics of good image of a
job. Besides, promotion and career development policies of organisation also attract potential

2. External Factors:

Like internal factors, there are some factors external to organisation which has their influence
on recruitment process.

Some of these are given below:

a. Demographic Factors:
As demographic factors are intimately related to human beings, i.e., employees, these have
profound influence on recruitment process. Demographic factors include sex, age, literacy,
economic status etc.

b. Labour Market:
Labour market conditions i.e., supply and demand of labour is of particular importance in
affecting recruitment process. For example, if the demand for a specific skill is high relative to
its supply, recruiting employees will involve more efforts. On the contrary, if supply is more
than demand for a particular skill, recruitment will be relatively easier.

In this context, the observation made by 11PM in regard to labour market in India is worth
citing: The most striking feature in the Indian Labour market is the apparent abundance of
labour yet the right type of labour is not too easy to find.

c. Unemployment Situation:
The rate unemployment is yet another external factor having its influence on the recruitment
process. When the unemployment rate in a given area is high, the recruitment process tends
to be simpler. The reason is not difficult to seek. The number of applicants is expectedly very
high which makes easier to attract the best qualified applicants. The reverse is also true. With
a low rate of unemployment, recruiting process tends to become difficult.
d. Labour Laws:
There are several labour laws and regulations passed by the Central and State Governments
that govern different types of employment. These cover working conditions, compensation,
retirement benefits, and safety and health of employees in industrial undertakings.

Child Labour (Prohibition and Regulation) Act, 1986, for example, prohibits employment of
children in certain employments. Similarly, several other acts such as Employment Exchange
(Compulsory Notification of Vacancies) Act, 1959, the Apprentices Act, 1961; die Factory Act,
1948 and the Mines Act, 1952 deal with recruitment.

e. Legal Considerations:
Another external factor is legal considerations with regard to employment. Reservation of
jobs for the scheduled castes, scheduled tribes, and other backward classes (OBCs) is the
popular example of such legal consideration. The Supreme Court of India has given its verdict
in favour of 50 per cent of jobs and seats. This is so in case of admissions in the educational
institutions also.

Finding the interested candidates who have submitted their profiles for a particular job is the
process of recruitment, and choosing the best and most suitable candidates among them is
the process of selection. It results in elimination of unsuitable candidates. It follows scientific
techniques for the appropriate choice of a person for the job.

The recruitment process has a wide coverage as it collects the applications of interested
candidates, whereas the selection process narrows down the scope and becomes specific
when it selects the suitable candidates.

Stone defines, Selection is the process of differentiating between applicants in order to

identify (and hire) those with a greater likelihood of success in a job.
Steps Involved in Selection Procedure:

A scientific and logical selection procedure leads to scientific selection of candidates. The
criterion finalized for selecting a candidate for a particular job varies from company to

Therefore, the selection procedure followed by different organizations, many times, becomes
lengthy as it is a question of getting the most suitable candidates for which various tests are to
be done and interviews to be taken. The procedure for selection should be systematic so that
it does not leave any scope for confusions and doubts about the choice of the selected
candidate (Figure 5.6).

Brief details of the various steps in selection procedure are given as follows:
1. Inviting applications:

The prospective candidates from within the organization or outside the organization are
called for applying for the post. Detailed job description and job specification are provided in
the advertisement for the job. It attracts a large number of candidates from various areas.

2. Receiving applications:

Detailed applications are collected from the candidates which provide the necessary
information about personal and professional details of a person. These applications facilitate
analysis and comparison of the candidates.

3. Scrutiny of applications:

As the limit of the period within which the company is supposed to receive applications ends,
the applications are sorted out. Incomplete applications get rejected; applicants with un-
matching job specifications are also rejected.
4. Written tests:

As the final list of candidates becomes ready after the scrutiny of applications, the written test
is conducted. This test is conducted for understanding the technical knowledge, attitude and
interest of the candidates. This process is useful when the number of applicants is large.

Many times, a second chance is given to candidates to prove themselves by conducting

another written test.

5. Psychological tests:

These tests are conducted individually and they help for finding out the individual quality and
skill of a person. The types of psychological tests are aptitude test, intelligence test, synthetic
test and personality test

6. Personal interview:

Candidates proving themselves successful through tests are interviewed personally. The
interviewers may be individual or a panel. It generally involves officers from the top

The candidates are asked several questions about their experience on another job, their
family background, their interests, etc. They are supposed to describe their expectations from
the said job. Their strengths and weaknesses are identified and noted by the interviewers
which help them to take the final decision of selection.

7. Reference check:

Generally, at least two references are asked for by the company from the candidate. Reference
check is a type of crosscheck for the information provided by the candidate through their
application form and during the interviews.
8. Medical examination:

Physical strength and fitness of a candidate is must before they takes up the job. In-spite of
good performance in tests and interviews, candidates can be rejected on the basis of their ill

9. Final selection:

At this step, the candidate is given the appointment letter to join the organization on a
particular date. The appointment letter specifies the post, title, salary and terms of
employment. Generally, initial appointment is on probation and after specific time period it
becomes permanent.

10. Placement:

This is a final step. A suitable job is allocated to the appointed candidate so that they can get
the whole idea about the nature of the job. They can get adjusted to the job and perform well
in future with all capacities and strengths.

Difference between Manpower Planning and Career

Article Shared by Kalpana R

Difference between Manpower Planning and Career Planning!

The term manpower planning and human resource planning are synonymous but manpower planning is
different from career planning.

Manpower planning is the process by which management determines how an organisation should move
from its current manpower position to its desired manpower position. Through planning, management
strives to have the right number and the right kinds of people at right places, at the right time to do things
which result in both the organisation and the individual receiving the maximum long-range benefit.

As defined by G. Stainer Manpower planning the strategy for the acquisition, utilisation, improvement,
and preservation of an enterprises human resources.
It relates to establishing specifications or the quantitative requirements of jobs determining the number
of personnel required and developing sources of manpower. Manpower planning is thus concerned with
forecasting the future manpower requirements of organisation.

A career, on the other hand, is an individual concept. An employee plans his career in any enterprise. A
career is defined as a sequence of work-related experiences in which a person participates during the
span of his work life.

A career can lend order and meaning to events and provide a relationship including work, in which a
person is involved. A career is central to complete development of an individuals identity. It is important
for an employee to plan a career, even if the employer provides little guidance or encouragement.

Individual career planning consists of different phases: self-appraisal, information gathering on

occupations, goal selection, and planning and implementation.

Every organisation undertakes career development programmes. Career development is a personnel

activity which helps individuals plan their future careers within the enterprise, in order to help the
enterprise achieve its objectives and the employee achieve maximum self- development.

Both situations arises because a company or an organization is facing problems when it comes to efficiency
and profitability. The other situations that will cause downsizing or restructuring is when there is a merge,
pressure from the competition, decrease in the hierarchy levels and/or the introduction of new and updated
technologies that requires new hires; basically actions that puts the needs of the company on top of just profit.
Despite these common grounds between the two corporate actions, they are not the same and have significant
differences between them; they can be differentiated in the following ways

What is the Meaning of Downsizing?

In the corporate world, downsizing is the action of permanently reducing the number of employees and/or
divisions and department in the company in order to increase profit Also known as trimming the fat, it can
also be achieved by redesigning the work profile from one employee to another or reordering and trimming
the system that runs the organization, all this to improve profitability, efficiency, productivity and especially
the competitive stance of the organization in the playing field. In downsizing, just reducing the number of
employees is not the only action taken, here are therefore the three types of downsizing
1. Reduction of the number of employees: The main target from reduction of the number of employees is the
elimination of too many positions and head count that requires a lot of cost and time. No matter what the
result aimed from taking this step, it is usually one of those actions that negatively affects the employees
directly and one that usually earns the company a bad reputation. Hence employers are usually very
meticulous and careful when this action has to be taken; Careful considerations and meetings usually takes a
lot of discussions before they agree to a layoff.

2. Redesign workflow: Since reduction in the number of employees is a very unpopular choice, employers
resorts to another type of downsizing where the type of work and the job profiles are being redesigned. This is
a strategy that involves evaluating the types of work or systems and processes and if they are actually
important and needed; which ones can and should be eliminated. Unnecessary work and system processes
that takes up the time and the resources and apart from the redesigning workflow and hierarchies, this type of
downsizing also involves merging of different positions and job profiles.

3. Restructuring: Yes, this is one type of downsizing, fairly unpopular but has provided answers and results for
high inefficiency and low profitability. This type includes major reconfiguring of the organizational structure
and looks, to changing the atmosphere and/or environment of the company. This leads to a more focused
attention on customer engagement when there is a downfall in the profits of a company and hence leading to
more profits. However this is not very effective when the problems faced by the company is full-blown and so
is usually taken to action during the very early stage of financial difficulties.

What is the Meaning of Restructuring?

Restructuring is the act of changing the whole organizational and systemic structure of the whole company. A
drastic modification that looks towards eliminating problems like debt, inefficiency and financial losses with
the changes being focused on the legal rights, hierarchy, operation, system and the structure of an
organization. In order to become worthwhile again and better organized, the community of the corporate
world chooses to take this step which has proven advantageous for the organization, even though the most
likely endgame is selling the company for a profit. Here are the four types of corporate restructuring

1. Merger: The first step to any restructuring act is merging two or more businesses into one so that there is
shared responsibilities, cost and resources in a single entrepreneurship. Usually has a huge to very little effect
on the market, mergers are a good strategy in getting the competition working together and thus ensuring a
successful joint in profits and success. This is a very effective step towards achieving product extension and
geographical market extension into unrelated yet profitable industries. Mergers are also divided into types
where one is done through absorption and the other through consolidation of properties and ownership.

2. Acquisitions: Another facet of restructuring is the acquisition step where a smaller firm is being acquired by
a larger more profitable firm either in a hostile or a friendly takeover. Most of these acquisitions stems from
the loss in profits or a general fall from the competitive market; a bigger and more successful firm takes over
the entire industry that helps dominating the playing field or just plain increase in the economic profits. This
action where there is a complete takeover in controlling the other companys assets and ownership has, many
times been a good step taken as this has proven results, advantages and eventually success.

3. Joint Ventures: As suggested by the title, this step involves an understanding between two or more
enterprises to take on market ventures together for better results and economic profits. This is a good way to
share cost and risks, to get the advantage of more resources and size of market, expenses and of course,
management. The most important gain from this movement is acquiring new skills and expertise, benefits that
are also complementary and new product development that more often has a big success probability.

4. Disinvestment: This step involves the sale of a companys assets in small or large parts and/or the sell out of
a part of the companys investment or undertakings for a small amount of profits. These sold out assets or
investments are usually the businesses that are not the core of the industry and evaluated to be good for
elimination. Strategic alliances and signed agreements where there is a shared or total sell out of a part of the
organizational assets will help the parent company lose some of the fat that is not actually needed.

Reasons for Downsizing:

As noted above, downsizing is usually the result of a crisis that an organization faces like mergers,
acquisitions, the change in the management of the company, an economic crisis, a change is the industrial
strategy, excessive workforce, automation and/or cost reduction. Here are four of the most common reasons
for downsizing

1. Cost Reduction: If the employees work is considered a liability then the most likely step to take is to reduce
the cost that is involved by eliminating the need for that employee in the company. Low production and
inefficiency are the other two very common reasons behind cost reduction which has in turn loosened up the
companys heavy assets that most often are liabilities.
2. Low Productivity: A certain number is giving a fixed rate of productivity and so the reasoning behind this is
that, if cutting down the number of employees and still be able to give the same rate of productivity then why
not? The other reason for this is that in this world of technological updates, a piece of machinery might be able
to do the same kind of job than a handful of employees and thus increasing productivity with lesser amount of

3. Economic Crisis: One of the main reasons for downsizing is an economic crisis where the need to cut a
number of employees so that the crisis is averted; downsizing the company will also help in cost reduction and
output is therefore balanced with the resources.

Reasons for Restructuring:

There are many reasons for restructuring a company and some of these are the changes in the business
atmosphere, downsizing, updated methods of working, new management, technological changes, mergers and
acquisitions, buy-outs, financial issues and legal problems. Most often, companies are being moved and
reorganized so that productivity increases and the control on the market scene is more diverse and profitable.
The following points are the most common reasons for the restructuring of an organization

1. Downsizing: One of the reasons that cause a complete turn around of the organization is downsizing the
whole company where there is a reduction in the number of employees and therefore repositioning of work,
systems and productivity numbers and sales are needed. New strategies usually follows downsizing at the
helm and therefore, with the new strategies in place, there is a call for the restructuring of systems and

2. Updated methods of working: Newer ways of getting work done such as a change in the atmosphere of the
workplace, when there are outsourced employees and even the upgradation to newer technologies would
require a new structure and systems that is being built around the new methods. New promotions that would
eventually bring about a change in management is also another reason for new structures and organizational
rules to be employed so that it envelops the new management working strategy.

3. Mergers and acquisitions: These reorganizations of the industry is obviously followed by an intense
restructuring of the merged and acquired company/companies that results of a larger resource structure,
shared responsibilities, cost structure and/or organizational arrangements that needs some rethinking and
rearranging. With the new ownership that is in place and the probability of a larger market target or
production values.
Difference between Downsizing and Restructuring:

Despite the many similarities between these two corporate strategies when it comes to bringing about these
changes in the industries and the organization; there is another important and very common aim in getting a
result that will be profitable to the organization at the end of the steps that has been taken. However, there are
differences between these two important steps that many organizations have to undertake in order to cut
their losses and ensure sustainability. Here is a breakdown of the most common differences between the two

1. Meanings: Even though both stems from a crisis faced by organizations where their success and profitability
is under fire, there is one huge difference between the two; while downsizing is mainly the reduction in the
number of employees, restructuring does not always include reducing the number of employees;
Restructuring is basically a way of reorganizing the whole structure and processes of the systems and work
profile that helps the resources to be very efficient while downsizing also consists of the above steps however
this usually starts with laying off of employees.

2. Ownership: This is one of the biggest differences between the two where downsizing does not have a new
ownership strategy as its end game, restructuring is especially one that involves merging and acquisitions
that will sometimes end in the parent company having a new hierarchical head to everyone or especially the
merged company. Restructuring is also hierarchical reorganization and hence even if the restructuring does
not include mergers and acquisitions, there is also a change of hands in the highest ranks of the hierarchy.

3. The breakdown: Downsizing usually is the best way that a company can take inorder to fight inefficiency
and low productivity, while restructuring is the step taken when there is a real crisis that might actually lead
to the downfall of a company like debts and low number for the products. Between the two, the most likely for
the company to get into a merger is restructuring, while downsizing is just the cost reduction by cutting down
the number of employees.

There is a lot of common points between the two and they are actually interlinked where downsizing might
also lead to the restructuring of the whole organization, though this might not lead to mergers and
acquisitions, there will be a need to reorganize the work profile, systems or even management within the
company. Restructuring has downsizing as one of the reasons that leads to this strategic move; however there
might be a merger or a change in the management and an ownership change with this step. A lot of common
points and again, these are two different terms that indicates two different strategic steps and end results.
Job Design - Meaning, Steps and its Benefits
Job design follows job analysis i.e. it is the next step after job analysis. It aims at outlining and organising tasks, duties and
responsibilities into a single unit of work for the achievement of certain objectives. It also outlines the methods and
relationships that are essential for the success of a certain job. In simpler terms it refers to the what, how much, how many and
the order of the tasks for a job/s.

Job design essentially involves integrating job responsibilities or content and certain qualifications that are required to
perform the same. It outlines the job responsibilities very clearly and also helps in attracting the right candidates to the right
job. Further it also makes the job look interesting and specialised.

There are various steps involved in job design that follow a logical sequence, those that were mentioned earlier on. The
sequence is as follows:

1. What tasks are required to e donerolehr mana or what tasks is part of the job?

2. How are the tasks performed?

3. What amount are tasks are required to be done?

4. What is the sequence of performing these tasks?

All these questions are aimed at arriving upon a clear definition of a specific job and thereby make it less risky for the one
performing the same. A well defined job encourages feeling of achievement among the employees and a sense of high self

The whole process of job design is aimed to address various problems within the organisational setup, those that pertain to
ones description of a job and the associated relationships. More specifically the following areas are fine tuned:

Checking the work overload.

Checking upon the work under load.

Ensuring tasks are not repetitive in nature.

Ensuring that employees don not remain isolated.

Defining working hours clearly.

Defining the work processes clearly.

The above mentioned are factors that if not taken care of result into building stress within the employees.
Benefits of Job Design

The following are the benefits of a good job design:

1. Employee Input: A good job design enables a good job feedback. Employees have the option to vary tasks as per their
personal and social needs, habits and circumstances in the workplace.

2. Employee Training: Training is an integral part of job design. Contrary to the philosophy of leave them alone job
design lays due emphasis on training people so that are well aware of what their job demands and how it is to be done.

3. Work / Rest Schedules: Job design offers good work and rest schedule by clearly defining the number of hours an
individual has to spend in his/her job.

4. Adjustments: A good job designs allows for adjustments for physically demanding jobs by minimising the energy spent
doing the job and by aligning the manpower requirements for the same.

Job design is a continuous and ever evolving process that is aimed at helping employees make adjustments with the changes in
the workplace. The end goal is reducing dissatisfaction, enhancing motivation and employee engagement at the workplace.

Job Enlargement - Meaning and its Benefits to

the Organization
Job enlargement is a job design technique wherein there is an increase in the number of tasks associated with a certain job. In
other words, it means increasing the scope of ones duties and responsibilities. The increase in scope is quantitative in nature
and not qualitative and at the same level.

Job enlargement is a horizontal restructuring method that aims at increase in the workforce flexibility and at the same time
reducing monotony that may creep up over a period of time. It is also known as horizontal loading in that the responsibilities
increase at the same level and not vertically.

Many believe that since the enlargement is horizontal in nature there is not a great need for training! Contrary to this, job
enlargement requires appropriate training especially on time and people management. Task related training is not required
much since the person is already aware of the same or doing it for some time.

Benefits of Job Enlargement

The following are the major benefits of Job enlargement

1. Reduced Monotony: Howsoever interesting the job may appear in the beginning, sooner or later people complain of
boredom and monotony. Job enlargement if planned carefully can help reduce boredom and make it more satisfying
and fulfilling for the employees.
2. Increased Work Flexibility: There is an addition to the number of tasks an individual performs. There is thus an
increased scope of carrying out tasks that are versatile and yet very similar in certain aspects.

3. No Skills Training Required: Since the individual has already been performing the task in the past, there is no great
requirement for imparting of new skills. However people and time management interventions may be required. The
job thus gets more motivational for the one performing it.

Job Enrichment and Job Enlargement

1. The difference between job enrichment and job enlargement is essentially of quantity and quality. Whereas job
enlargement means increasing the scope of job quantitatively by adding up more tasks, job enrichment means
improvement in the quality of job such that employees are more satisfied and fulfilled.

2. Through job enrichment an employee finds satisfaction and contentment in his job and through job enlargement
employee feels more responsible and worthwhile in the organization.

3. Job enrichment entails the functions of planning and organizing and enlargement involves execution of the same. Both
complement each other, in that job enrichment empowers and enlargement executes.

4. Job enrichment depends upon job enlargement for success and the reverse in not true.

5. Job enrichment means a vertical expansion in duties and responsibilities and span of control whereas in job
enlargement the expansion is horizontal in nature.

Job enrichment has been found to have greater impact in terms of motivation when compared to job enlargement. Since
enrichment gives employee greater insights in managerial functioning and a better work profile, it is looked upon as an
indicator of growth and development. The same is not true in case of job enlargement which is seen as an employer tactic to
increase the workload.

Importance of Job Rotation, Enrichment and

Enlargement in Career Growth
Every individual aspires to grow professionally and reach the pinnacle of success within the shortest possible time frame. No
one wants to work at a junior or mid level position throughout his/her life. Now a days, when the competition is so fierce,
people who are multiskilled have better chances of not only getting selected in their dream companies but also earn quick
promotions as compared to those who have limited skills. You will always have an upper edge over individuals who are
reluctant to think out of the box and fail to contribute beyond their expertise. Why would your organization give you a
promotion or a salary hike if you do not know anything beyond data entry? Job rotation, enrichment and job enlargement play
a crucial role in ones career growth as they not only prepare employees for unpredictable circumstances but also help them
acquire additional skills and gain new knowledge.
Believe me, there is nothing great in doing something which you already know. Challenge lies in working on something which
is not your key area. There is nothing commendable if a marketing executive sells organizations products or services and
shares a good rapport with his/her clients. After all, he/she is implementing what all has been taught to him/her in his school
or college. On the other hand, if he helps the hiring team in not only recruiting suitable candidates but also ensuring a healthy
culture at the workplace, then definitely his efforts need to be acknowledged and appreciated. Such an individual deserves to
get a promotion for his initiative of contributing in some other department apart from his routine work. We all, at some point
of time would really love to manage teams or probably open our own firm. Remember, one should always dream big. Trust me,
handling a team would become a nightmare if you lack managerial skills and are not aware of what is happening in your
industry on the whole. After handling diverse tasks and multiple responsibilities, one really gets the confidence required to
face challenges with a smile and also come out as a winner.

Job enlargement makes you tough and you kind of get used to working more than your capacity. Such a quality helps you
survive in high pressure jobs or tough situations where you are expected to not only meet but also exceed your targets in a very
short period of time. What is the difference between a junior executive and top level manager? A junior executive is only
expected to follow his superiors instructions where as a top level manager is expected not only to make his team work but also
handle pressure. Remember, you are not a good boss if you are unable to handle pressure and further pass it on to your team
members. An organization would only give you promotion if it feels you will be able to deliver without putting unnecessary
pressure on your team members.

Job rotation, job enrichment or for that matter job enlargement teach you to be self dependent. You learn not to crib or
complain even in the worst situations and most importantly how to manage time. Trust me, if you master time management
skills, you will never ever fail in life. One also learns how to manage relationships as a result of job rotation or job enrichment.
Since you get to work with so many people with varied expertise, you not only gain from their knowledge but also learn how to
deal with them. Job rotation, enrichment and enlargement teach you to do things differently.

Job Enrichment - Meaning and its Benefits

Organizations are increasingly facing the heat of attrition, which is not good to health of the same. Lots of time, money and
resources are spent into training an individual for a particular job and when he / she leaves the return on that investment
equals null. Often it is not for the money that people leave; that may be the reason with the frontline staff but as we move
towards the upper levels of organisational hierarchy, other reasons gain prominence. Many of those who quit their jobs
complain of their jobs as uninteresting!

All this has compelled organisations to think of ways to make the job they offer interesting. Lots of efforts are made to keep
monotony at bay; job enrichment is one of them. It is the process of making a job more interesting, challenging and satisfying
for the employees. It can either be in the form of up gradation of responsibilities, increase in the range of influence and the
How does an Organisation Enrich a Job

Typically job enrichment involves combining various existing and new tasks into one large module of work. The work is then
handed over to an employee, which means there is an increase in responsibilities and scope. This increase in responsibility is
often vertical. The idea is to group various tasks together such that natural work units are created.

In addition expanding jobs vertically also gives employee direct control over works units and employees that were formerly
under the jurisdiction of top management only. While on one hand this increases the ownership of the employees in their
work, it also relieves the unnecessary burden from the top management.

Job enrichment also opens up a feedback channel for the employees. Employees are frequently apprised of their performance.
This keeps them on track and helps them know their weak and strong points. Performance standards are set for the employees
themselves and future performances are matched against the benchmarks. All this without any serious intervention or
involvement of the top management!

In a certain bank that dealt with commercial credit letters for import and export trade, the employees processed the
documents in a sequence with each employee being specialised for certain aspect of verification. Often it so happened that a
mistake at preceding level lead to a series of mistakes at succeeding level. Errors accumulated at each level and this result in
huge loss of productivity.

The organisation decided to go for job enrichment where each employee or clerk was specialised in all aspects of processing.
Each employee was now able to handle a client on his own. After some time it was found out that the transaction volume
increased by 100 percent!

Benefits of Job Enrichment

Research studies on job enrichment found out decreased levels of absenteeism among the employees, reduced employee
turnover and a manifold increase in job satisfaction. There are certain cases however where job enrichment can lead to a
decrease in productivity, especially when the employees have not been trained properly. Even after the training the process
may not show results immediately, it takes time to reflect in the profit line.

Job Characteristics Model

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Hackman and Oldhams job characteristics model proposed that the relationship between core job
characteristics and psychology states is moderated by an individuals growth need strength. Similarly, the
relationship between the psychological state and personal and work outcome is moderated by growth need
strength,. Hackman and Oldhams job characteristics model is summarized below:

Hackman and Oldhams model is divided into three parts. These are:
1. Core job Characteristics
2. Critical psychological states and
3. Personal and work outcomes.
Core job characteristics include five aspects i.e. task identity, task significance, skill variety, autonomy and
feedback. Critical psychological states encompass four elements. Finally personal and work outcomes include
four factors.

If all these aspects work positively and in accordance with the organizational policies hoping organization can
achieve its purposes in time. The above model is bases on a research study. Due to the expiry of time and
change of place some limitations may limit the application of the model.

A. Core Job Characteristics

There are five core job characteristics in an organization. The five core job characteristics are discussed below:
1. Task identity: Seeing a whole piece of work. Employees can complete a task from beginning to end with an
identifiable outcome.
2. Task significant: Importance of the job. The characteristic is determined by the impact the employees work
has no other within or outside the organization.
3. Skill variety: the degree to which employees are able to do a number of different tasks using many different
skills, abilities, and talents determines the skill variety.
4. Autonomy: the degree to which employees have control over their work.
5. Feedback: The degree to which the job offers information to employees regarding performance and work
B. Critical psychological states
The three psychological states are defined in the following terms:
1. Experienced meaningfulness: The degree to which employees perceive the work as being meaningful,
valuable, and worthwhile.
2. Responsibility: The degree to which employees feel accountable and responsible for the outcomes of their
3. Knowledge of result: The degree to which employees know and understand how well they are performing
on the job.
C. Personal and work outcome:
Form types of personal and work related outcomes may be achieved on the basis of job characteristics and
psychological supports. These are as follows:
1. High internal motivation: Employees work more and with joy.
2. High satisfaction: They get satisfied with their jobs following the fulfillment of needs.
3. High work quality: Employees perform their duties for producing high quality goods and service.
4. Low absenteeism and turnover: If core job features and psychological states behave positively, workers
show low absenteeism and turnover also.
A number of factors influence the remuneration payable to employees. They can be
categorised into (i) external and (ii) internal factors.

Internal Factors

These factors include the following:

Ability to pay
This is one of the most significant factor influencing employee compensation. Generally, a firm, which is prosperous and
successful, has the ability to pay more than the competitive rate. This way it can attract a superior caliber of personnel. Often
the labour unions also demand an increase in compensation on the grounds that the organisation is prosperous and is able to
pay more.

Numerous employees related factors also influence his or her compensation. These include rhe following:

PerformanceIt is always rewarded wirh pay increase and as a result it motivates the workers to do better in future.

ExperienceThis makes a person perfect by providing valuable insights and thus rewarded also. Today companies are
demanding for 10 to 20 years experience candidates especially for the executive positions. The companies presume
that experience candidate posses leadership skills which influence the other behavior and performance. Generally
experience candidate perform the job without need of training which is time consuming and deals with matter of cost
to company. Hence the experience candidates demand more pay than an unexperienced candidate.

SeniorityIn today's environment seniority of employee making difference in payment of compensation compared to
Jr employees. Naturally senior employees demands for more salary than fresher because of their hold on related job
and its functions. Today many companies are demanding senior employees for key positions by offering fat pay and
even sometimes retired employees are offered with handsome salary for key positions which deals with multitasking
in organisation. Trade unions always prefer this objective criterion for pay rises.

PotentialFirms also pay their employees, especially young ones on the basis of their potential. software companies
are very good example for this, IT graduate just who completed his education having potential in the subject can gain a
good job with high payment anywhere in the world. Good example, student of Indian Information Technology (IIT)
from Delhi had bagged job of payment 7 million (70 lakhs) Indian rupees per year in Twitter Inc famous social
networking website

Job requirements
Wages arc also influenced by the requirements of a job such as physical and mental requirement. Jobs, which demand more
skill, responsibility, efforts and are of hazardous in nature, will carry high wage tag with them.
Job evaluation
Job evaluation establishes a consistent and systematic relationship among base compensation rates for all jobs. In other words,
it establishes the satisfactory wage differentials.

Organisation's strategy
The organisation's strategy regarding wages also influences employee compensation. For example, an organisation, which
wants rapid growth, will set higher wages than competitors. On the other hand, organisations that want smooth going and just
maintain the current earning will pay average or below average.

External Factors

These factors include the following:

Laws and Regulations

Laws and regulations impact the remuneration of employees in many areas, such as:

Work hours and compulsory time-off (paid and unpaid)

Minimum wage


Compulsory bonuses

Employment at will

Labor market

Official laws on wage and salary, labor contract, payment time, wage payment delay, working insurance, and so on.

Peoples standard of living in the areas where the offices of the company are.

Peoples living and consuming customary.

The average wage rate in the labor market of similar work.

The state of economy also influences the wage and salary-fixation. Wage rates will he different in a stable economy than in a
depressed economy. In case of depressed economy there may be increase in supply of labour and this results in the fixation of
lower wage rates.

Increase in the prices of commodities and decrease in value of the money is called as inflation. The causes of inflation are many
which are raising costs, fall in the currency value in international markets, raising taxes by government and stagnation in the
development of economy, etc. In India year 2012, due to the inflation nearly 22 listed companies had increased salary of its
employees ranging between 12% to 27% compared to last year. Example Reliance Industries Ltd had paid nearly13% increase
in salaries to its employees compared to last year salaries and HDFC (Housing Development Finance Corporation) Bank had
paid nearly 21% increase in salaries to its employees compared to last year salaries.

Technological changes
Technological changes also influence the fixation of wage levels. Due to the advancements in the technology there may be
shortage of skilled manpower in that area. So, the organisation will provide high wages for skilled personnel. For example,
information technology (IT) industry in India and abroad is suffering from the shortage of IT experts.

Academic Institutions
Having good academic qualifications from Reputed and standard educational institution influence the compensation of the
potential candidate in their recruitment in companies. Example, Indian Top Business schools like Indian Institute of
Management, and IIT (Indian Institute of Technology) graduates demands higher pay packages compared to other normal
institutions. Candidates seeking admission into theses institution requires to qualify tests conducted on domain knowledge.
Candidates those who admit in these institution are determined, having competence and good domain knowledge which
companies require.

Methods of Job Evaluation: Qualitative

and Quantitative Method
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The two methods of job evaluation are as follows: 1. Qualitative Methods 2. Quantitative
Job evaluation methods can be divided into two categories i.e. Non quantitative methods and
quantitative methods. The former are known as such because quantitative aspects of jobs are
considered for ranking them while in the later quantitative techniques are used in listing the

1. Qualitative Methods:

Evaluation of a thing can be done by keeping in view the qualitative as well quantitative
aspects. Since quality is an important aspect of measurement and evaluation, It is of immense

Following qualitative methods are generally used in job evaluation:

I. Ranking Method

II. Job Grading Method

I. Ranking Method:

All the jobs are ranked in order of their importance from simplest to the toughest order, each
job being higher than the previous one in the sequences. A committee of several executives is
constituted, which analyze the description of jobs and ranks them in order of importance.

The committee does not have specific factors before it but the things like nature of job,
working conditions, supervision required, responsibilities involved etc. are considered while
raking the jobs. These factors are not given any weight age. Following steps are taken in

(a) Preparation of Job Description:

The first step in job evaluation procedure is the preparation of job description. Though it is
not essential to prepare job description under ranking system but it is better and helpful in
this system. Many people assigned with the job of ranking will give different ranking to the

(b) Selection of Raters:

The next step in the process of raining is the selection of raters. The jobs may be ranked
department wise or in groups of workmen (Factory jobs, clerical jobs, unskilled jobs). Factory
jobs should not be compared with clerical jobs or unskilled jobs because of their different

(c) Selection of Rates and Key Jobs:

First of all certain key jobs are identified, selected and then compared with other jobs. The
key jobs are carefully chosen from major departments or main functions.

(d) Ranking of all Jobs:

Comparison of similar jobs is made to establish its exact ranking in the scale. All the jobs are
then ranked from lowest to highest or vice-versa.

The ranking method is suitable in small concerns only where each job can be compared with
the other for determining their ranks.

Ranking method of job evaluation has the following benefits:
1. It is very easy to understand and easy to explain to employees.

2. This method is economical in operation as compared to other methods.

3. It can be installed without any delay as it requires minimum time.

This method suffers form the following drawbacks:
1. The ranking is not based on standard criterion so human bias due to presences of human
factor can not ruled out.

2. Because factors like skill, responsibility, efforts etc. are not analyed separately, the wage
rate paid for different jobs influence the rates.
3. Under this system the jobs are only ranked in some order and the exact difference between
different jobs is not determined.

4. The chance of inaccurate ranking cannot be neglected.

5. The employees/workers may resent arbitrary ranking of jobs.

II. Job Grading Method:

In this method jobs are classified or graded in groups and each job is assigned to one of the
grades or classes. With the help of job analysis, information about different jobs is collected
and they are put under different grades as per their nature, importance, responsibility and
other requirements.

For each grade or class there is different rate of wages. The jobs may be graded as skilled,
unskilled, clerical, administrative, etc. This method is considered to be an improvement over
ranking method in that a predetermined scale of values is provided.

1. Preparation of Grade Descriptions:

The first step involved in this method is to prepare grade description to evolve classification
of jobs. A number of grades, different from each other, are selected. The grading should be
done by considering the nature of duties required for the job, supervising responsibilities etc.
Each job is then, attached to an appropriate grade.

2. Selection of Grades and Key Jobs:

A number of jobs are graded, normally between 10 to 20 are selected. Key jobs are carefully
chosen form important functions and major departments.

3. Grading the Key Jobs:

Key jobs are assigned appropriate grade level and their relationship with each other is

4. All the Jobs are put in Relevant Grades or Classifications:

For example, all unskilled jobs are put in one class, clerical jobs in another class and so on.
The jobs in one class receive the same wage rates.

1. A systematic criterion is followed in grading various jobs. It is easy for the workers to
understand the standard used for classification.

2. The method is simple to understand and easy to operate. It does not require any technical

3. It is easy to determine and implement pay scales for various grades or classes.

4. This method is successfully used in government departments.

1. The classification of jobs is done by some of the executives, human bias exist in this method
because no set standards are available for classification.

2. No job analysis is essential in this method; there is a possibility of wrong classification for

3. With the increase in number of jobs, the system becomes difficult to implement.

4. The system is not suitable for large organizations because of its not- flexibility.

2. Quantitative Methods:

Following quantitative methods are used in job evaluation:

(a) Point systems

(b) Factor Comparison Method

1. Point System:

This is the most widely used technique of job evaluation. It involves quantitative and
analytical approach to the measurement of job value. A number of important factor to be
considered in each job are identified. The degree of each factor is also determined for
assigning points.

Various factors are assigned points and sum of them gives us an index for the relative
importance or weight age of the job that are related. The point system is based on these
assumptions that important factors of each job can be determined for evaluating it. The points
of different jobs are later on , converted into wage rates.

Following steps are taken for job evaluation:

1. Type of jobs to be Evaluated:
There are number of jobs in every organization and these may range form top executive to
unskilled one. Similar jobs should be put in the same class or category for evaluation purpose.
There should be separate evaluation procedure for each class because the factors affecting
them will be different. The job requirement of supervisor will be different from that of an
unskilled worker or semi skilled labour.

2. Number of Factors to be used:

It is very difficult to select the number of factors required for evaluating a job. The number of
factors should be such that all aspects of a job are evaluated. The number of factors to be used
varies form enterprise to enterprise ranking from 3 to as many as 50. The common factors to
be selected are education, job conditions and other similar requirements training skills
physical ability, mental requirements, responsibility.

3. Determination of Degrees:
Each factor of evaluation should be further subdivided into degrees for example, experience
which is commonly used factor in each job may be subdivided into five degrees. The first
degree may have experience of 3 to 6 month with 5 point, second degree points having
experience from 6 months to 1 year with 10 points 15 for experience between 1 to 2 years, 20
points for experience of 2 to 4 years and 25 points for experience of over 4 years and so on.

4. Assigning of Weights:
Each factor may be assigned a weight as per its significance. For executives mental
requirements will have more weight age than physical requirements.

Assigning Money Values to points:

The points assigned to each factor are summed up for finding out the value of job. The value of
jobs is translated into terms of money with a predetermined formula. If it is assumed that 1
point is equal to Rs. 20 the 160 points are equivalent to Rs. 3200 in money value. In this
manner, the evaluation is done in the point system.

Point system has the following merits:
1. It gives us a numerical basis for wage differentials.

2. The scale, once decided can be used for fairly a long period.

3. A job can easily be evaluated in money terms as these are assigned according to points
connected with that job.

4. The system of job evaluation being systematic and objective is more acceptable to workers
as well as management.

5. The element of human basis is reduced to minimum level.

6. This method is useful even if the number of jobs is very large. The system enjoys stability so
as factors remain relevant to these methods.

7. This method is more accurate as compared to earlier methods adopted for evaluation.

The point system of job evaluation suffers from the following limitations:
1. The use of this method involves high cost, it cannot be adopted by medium or small scale

2. The task of defining job factors and then degree of factors is a time consuming task.

3. The selection of factors and then sub factors is a difficult proposition.

4. The allotting of marks to various factors and sub factors is also a difficult job.

2. Factor Comparison Method:

This method is a combination ranking and point system of job evaluation. It was first
developed by E.J. Benge in 1926. In this method the relative rank of the various jobs is
evaluated in relation of monetary scale some key jobs are identified in the organization at the
first instance and then ranked considering one factor at a time, in this method five factors are
generally evaluated for each job i.e. mental efforts, skill, physical effort, responsibilities and
working conditions. Following steps are taken under factor comparison method.

1. Selecting factors to be used:

The first step under this method is the selection of factors to be utilized for evaluation. The
persons preparing the job descriptions should be given the proper explanation of these

The universally used factors are:

(i) mental efforts

(ii) Physical efforts

(iii) skill needed

(iv) responsibility and

(v) working conditions.

2. Selection of key jobs:

The selection of key jobs is the next very important step. They constitute a standard and all
other jobs are to be compared with key jobs. All key jobs should be exact and well understood
and there should be no conflict between management and employees about them. The job so
identified should cover the range from lowest to the highest paid ones etc.

3. Ranking of key jobs:

The various jobs are ranked on the basis of each of the five factors given earlier.

4. Valuing the factors:

Each factor of key job is then allocated a basic pay. The pay for such jobs should range from
the lowest to the highest.

5. Comparison of Jobs:
All jobs are compared with key job factor by factor to find out their relative importance and
position in the scale of jobs. The money value of jobs is also determined with this comparison.

6. Establishing wage structure:

By assigning money value to each factor of various jobs, a wage structure is determined by
summing up the various values.

Factor comparison method enjoys the following advantages:
1. This system is systematic where every job factor is quantified.

2. It can easily be explained to workers.

3. The relative value of each job is determined by comparison with some key job.

4. The number of factors used being limited, it helps in avoiding overlapping.

5. It can be used for evaluation of unlike jobs.

This system suffers from the following draw backs :
1. It is difficult to operate as selection of unfairly paid jobs as key jobs can result in
considerable error.

2. There may be frequent changes in wage levels requiring adjustment in key jobs.

3. The system is complex and cannot be easily understood by non- supervisory staff or
unskilled labour.

4. This method is expensive and small units cannot afford to use it.


Human Resources Planning have been a function of management since the origins of the modern industrial

Human Resources planning mean different means to different organizations. To some companies, human resources
planning mean management development. It involve helping executives to make better decisions, communicate
more effectively, and know more about the firm. The purpose to make men and women better managers. The
emphasis is having current managers who are sucked in there function and reasonably qualified for promotions.
Too frequently the acquisition and development of the skills and knowledge needed for the future are lacking. The
goal is often only to make the manager a better manager today.


Human Resources planning is a process by which management determine how the organization should move from
its current manpower position to its desired manpower position. Through planning, management strives to have
the right number and the right kinds of people, at the right place, at the right time, doing things, which result in
both organization and the individual receiving maximum long-run benefits. It is four-phased process. The first
phase involves the gathering and analysis of data through manpower inventories and forecasts, the second phase
consist of establishing manpower objectives and policies and gaining top management approval of these. The third
phase involves designing and implementing plans promotions to enable the organization to achieve its manpower
objectives. The fourth phase in consumed with control and evaluation of manpower plans sent programs to
facilitate progress to benefits both the organization and the individual. The long run view means that gains may be
sacrificed in the short run for the future grounds. The planning process enables the organization to identify what
its manpower needs is and what potential manpower problems required current action. This leads too more
effectively and efficient performance.

The objectives of human resource planning may be summarized as below:

u Forecasting Human Resources Requirements: HRP is essential to determine the future needs of HR in an
organization. In the absence of this plan it is very difficult to provide the right kind of people at the right time.

u Effective Management of Change: Proper planning is required to cope with changes in the different aspects which
affect the organization. These change needs continuation of allocation/ reallocation and effective utilization of HR
in organization.

u Realizing the Organizational Goals: In order to meet the expansion and other organizational activities the
organizational HR planning is essential.

u Promoting Employees: HRP gives the feedback in the form of employee data which can be used in decision-
making in promotional opportunities to be made available for the organization.

u Effective Utilization of HR: The data base will provide the useful information in identifying surplus and deficiency
in human resources.

Major reasons for the emphasis on HRP at the Macro level:

Employment-Unemployment Situation: Though in general the number of educated unemployment is on the rise,
there is acute shortage for a variety of skills. This emphasis is the need for more effective recruitment and retaining

Technological Change: The myriad changes in production technologies, marketing methods and management
techniques have been extensive and rapid. Their effect has been profound on the job contents and job contexts.
These changes cause problems relating to redundancies, retaining and redeployment. All these suggest the need to
plan manpower needs intensively and systematically.

Organizational Change: In the turbulence 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 Change: The changing profile of the work force in terms of age, sex, literacy, technical inputs and
social background has implications for HRP.
Skill Shortage: Unemployment does not mean that the labour market is a buyers market. Organizations generally
become more complex and require a wide range of specialist skills that are rare and scare. Problems arise when
such employees leave.

Governmental Influences: Government control and changes in legislation with regard to affirmative action for
disadvantages groups, working conditions and hours of work, restrictions on women and child employment, causal
and contract labour, etc. have stimulated the organizations to be become involved in systematic HRP.

Legislative Control: The policies of hire and fire have gone. Now the 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.

Impact of the Pressure Group: Pressure groups such as unions, politicians and persons displaced from land by
location of giant enterprises have been raising contradictory pressure on enterprise management such as internal
recruitment and promotion, preference to employees children, displace person, sons of soil etc.

Systems Approach: The spread of system thinking and advent of the macro computer as the part of the on-going
revolution in information technology which emphasis planning and newer ways of handling voluminous personnel

Lead Time: The log lead time is necessary in the selection process and training and deployment of the employee to
handle new knowledge and skills successfully.

Approaches to Human Resources Planning

On the theoretical plane there are three options to any educational planner. The first option is to treat the
education as consumption goods and demand for education as an aggregate of individual consumers demand
schooling, and to provide the facilities for education and training according. The second option is to view education
an investment goods, evaluate the investments in education at par with investment in education with the rate of
return on investment in physical capital. The third option is to considered skilled manpower as basic inputs to the
production goods and services within the economy; assess the skill requirements to achieve any predetermined
economic growth target, and to gear the expansion of educational system to provide the needed education and

There are three approaches to educational planning:

Social demand approach

Rate of return approach, and
Manpower requirement approaches.

Social Demand Approach: The social demand approach lies on the assessment of societys requirement for
education. In principles, it is an aggregate of individuals demand for education in respect of all individuals within
the society. It is not always possible particularly in large societies, to assess individual demand for education. In
practice, therefore, social demand approach relies on a projection of past trends in demographic aspects of
population and the enrollment at the different levels of education.

Social demand approach is thus capable of revealing the number of students with differently types

of professional preparations that may be a given target date, based on past experiences. Projections of

social demand for education are contingent upon given levels of:

Income of educated people,

Taste and references of household for education,
Demographic characteristics such as fertility and mortality,
Direct costs of education,
Student grants, and
Existing standard of admission to various levels of education.
Added to these constraints, there are the perennial problems associated with the data base on demographic aspects
at disaggregated levels such as districts, blocks and villages and data on wastage and stagnation in education, and
intensity of utilization of existing educational facilities. Social demand approach thus suffers from the difficulties
associated with any futurological exercise.

Rate of Return Approaches: Critics of social demand approach argue that the decision to choose

more or less of education, beyond a legal school-learning age, is made by an individual who attaches

a positive value to the present and the future benefits of education. Aggregate of individuals demand

for education, which is constructed the social demand for education, should then be based exaggerate

of individuals assessment of benefits of education-reflecting the social benefits.

This brings us the rate of return approach to education:

Rate of return approach looks upon education as a contributor to productivity and this sense, it is expected to
facilitate investment decisions in education whether or not the students should undergo

more schooling, or whether or not the state should invest more and expand educational facilities.

Like in the rate of return on investment analysis, rate of return on investment in education is used
to expand educational facilities until schooling equalizes.

On the one hand yield of investment in different types of education, and

On the other hand yield of investment in education vis-a -vis other sectors of economy.
Manpower Requirement Approach: The fundamental axioms of manpower requirements approach is that there is a
definite link between the education and economic growth and that lack of skilled manpower in required number
impedes growth. In this approach an attempt is made to forecast future requirements of educated manpower to
fulfill a future target of Gross National Product (GNP) or specified targets of industrial production. Based on the
forecasts of educated manpower requirement over a specified period, the planners would then indicate the
directions of development of the educational sector over the same specific period.

The basic steps involved in this exercise are as under:

Anticipating the directions and the magnitude of development of each individual sectors of the economy.
Evolving norms of the employing manpower in each individual sector keeping the view the
Technological optionsPresent as well as futurefor each sector of the economy.
Translating the physical targets for the development of each individual sector into the manpower
requirement using the sector specific manpower norms.
Estimating the educational; equivalents of the manpower requirement.
Analyzing the implications of estimates of educated manpower requirements for educational
development, based on assumptions regarding the enrollment rates, transitions probability and

wastage and the stagnation rates at the each level of education.

Limitations of the Manpower Requirement Approach:

The first limitation assumes that the educated manpower of different types are used in fixed proportions and that
there no substitutions possibilities among the various categories of educated manpower.

The second limitation is that it postulates a definite link between an industrial task and an educational level. Prices,
either in terms of cost of producing educated manpower or in terms of salaries and wages of educational people do
not play any role in matching demand with supplies of educated manpower in this brand of educational planning.
This makes the good sense if formal education and training is the only means of producing educated manpower. If
there are alternative ways of producing a given category of skilled manpower, then prices play a significant role and
the manpower requirements approach fails to take cognizance of this respect. In the Indian context, even in the
case of highly skilled occupation where graduate level engineers are required, it has been observed that over 30 per
cent of the manpower do not have the basic minimum qualification. They have reached these levels through on-the-
job training and such other informal training, in the requisite skills. Such persons are categorized as practical and
these practical are to be found in every occupation.

The crucial information in all forecasting exercises is the assumptions about the distant unknown
future. Any error in judgment, in this regard, will seriously affect manpower balances at a later date

resulting in either excess supply or excess demand. In the context of educational planning, excess

demand is relatively easier to manage. Excess supply, on the other hand, leads to serious economic

and sociological problems which are often difficult to deal with.


Often we express that the most important asset in organization is our people. Without the right people,

it is unlikely that even the most comprehensive and business plans/strategies will deliver negative

performances. The vast majority of organization comes when the right people with right knowledge,

skills and behaviour are deployed throughout an organization.

HR planning is how to achieve that match of skills, knowledge and behaviours. It is about:

Developing an understanding of everything possible about the internal and external environment
and how these will affect our current and future workforce. It is about understanding the make up of our current
workforce and the necessary skills, capabilities and aptitudes that will be required to achieve business outcomes in
our current and changing environment.

It is about assuring that we link our human resources strategies with business outcomes and that
our workforce plans reflect those initiative/strategies and provide our managers with a framework for making
informed decisions in line with our managers with a framework for making informed decisions in the line with our
mission, strategies plan and financial resources.

Also, it provides the opportunity for longer term thinking about future service pressures and
needs, and what you need to do now to get workable strategies in place not only for the employees development,
but for strategies financial and human capital management.

HR planning has a critical role to play in delivering improved services and is an important issue for

an organization. At its simplest, HR Planning is a planning process and analytical capability to measure and
compare the current workforce (supply or faces) with the future workforce (demand or space). This planning
process provides insight into the best policies and initiative needed to improve the overall

human resources system. It has a critical role in developing personnel requirements/data elements,

which should be linked to strategic organizational planning, budgeting processes and all recurring

recruitment needs, training recruitments and planning activities. There is no one set of model of workforce
planning but the underlying concepts are similar. All models are concerned about analyzing your current
workforce, and then extending that analysis to identify the future skills and competencies needed to deliver new
and improved services that are aligned with achieving the organizational mission. (Demand and supply analysis)
The comparison between the present workforce and desired future workforce will highlight your shortages,
surpluses and competency gaps, whether due to external pressure or internal factors. (Gap Analysis) These gaps
become the focus of each detailed workforce plan in identifying and implementing strategies that will build the
relevant skills and capacity needed for organizational success.

An ideal Human Resources Planning System should be:

Holistic in its approach linked with strategies planning and budget process.
Built around our service needs and skills required to deliver quality service.
Responsive to change variables i.e., economic, technological, political, environmental mandate.
Supportive of continual learning and development concepts.
Data driven that allow for scenario building because of changing assumptions for different desired
Before beginning the human resources planning process, you have to need to have a firm grasp on main drivers for
workplace planning and any influence of those drivers on the human resources planning exercise being done.
These drivers set the context for everything you will be looking at throughout this process. The four main drivers
for any human resources planning are:

Organization Directions: Includes the organizational plans, budget forecasts new technology,

working practices, organizational culture and reward systems.

Internal labour: Which includes a determination of human resources profile by multidimensions (gender, age,
grade, occupations, length of services etc.); identification of any internal management issues like retention,
separation, promotion patterns, etc. identify potential area of our workplace that are vulnerable to current or
future skills gaps imbalances and look at geographical issues that could be the cause of issues identified. All of
these factors have implications for recruitment and retention of our workforce across the organization.

External Labour: Demographic change in our potential workforce is affecting both the demand for services and
workforce supply to fill our vacancies.

Business Change: Technological changes are leading to changes in service/information delivery,

way of working and the skills needed in the workforce. Consequently, this will change the competencies

for positions and how we need to recruit, hire and engage our current and future workforce.

The scope of human resources planning is to build a longer term context within which short-term
staffing decisions can be made. Human resources planning is a living process and needs to be

periodically reviewed in order to respond to changing circumstances. Regular monitoring will ensure

that organizational element will avoid strategic drift and ensure that organizations human resource

planning remain current. This process is still about the ensuring that sufficient people with the right

skills are in place to deliver a seamless service to the internal and external stakeholders.

Five Phases for Human Resources Planning

1. Analyzing: What are the key human resources information needed?

2. Forecasting: Demand versus supply analysis.

3. Planning: Identification of stretogy

4. Implementing: Exemling the new stratogy

5. Evaluating: Feedback on effective of outcomes.

Analyzing: What are the key human resources information needed?

The over all human resources planning system should be well thought out, systematic and well

documented. The effectiveness of planning depends on the detail, accuracy and reliability of the

information sources. It is important to identify all factors that could influence future demand for

output/services as well as competencies of the internal and external supply of labour. Information

gathered during the analyzing phase must be reliable and accurate as this will be the basis of the

forecasting phase.

The begin the analyzing phase; there are four information sources that will provide key human

resources information needs. These includes; Organization direction and environmental factors

(demand analysis); internal and external labour (supply analysis). Each sources is listed below and

provides the ways to collect this information. The organization simply analyzing the supply (current

workforce profile) against the demand (future workforce profile).

Suggested checklist for organization information:

Demand Analysis.
Strategic plan/Business priorities.
Internal or External reports that could affects business outcomes.
Budget Estimates (Short-Term and Long-Term).
Plans for New Technology.
Employee Survey Information.
External Contract Services.
Organization Culture.
Changing Competencies.

Forecasting: Demand versus Supply analysis

Forecasting is considering the future needs of organization. One of the most useful outcomes of this phase is the
identification of potential problems or issues facing your organization. This analysis will be based on the data
collected from the information sources in the analyzing phase. The result of this phase will help to develop the gap
analysis and emergent strategies to manage the future. It involves the identification of any predicted changes
and/or developments that may result from demand and analysis. Business elements may have varying issues
identified based on needs of their organizations. The aim is to create necessary resources/strategies to optimize
the future position of organization. There are four steps in forecasting phase; identifying key workforce
assumptions, validating assumptions, utilizing assumptions for scenario building and performing the gap analysis.

The first step is to identify key workforce assumptions/issues for the elements based on the data/ information
collected from the information sources during the analyzing phase. Ensure that all of these forecasting assumptions
describe the potential impact on business element, any inherent risks and any likelihood of occurrence based on
element culture.

The second step is to validate these assumptions by utilizing focus groups or administrating
questionnaires/interviews to various leaders in the organization. The feedback provided will ensure that gathered
assumptions are valid and based on the basic data available. Additionally, feedback should provide insight in the
reasoning behind the assumptions.

The third step is utilizing these assumptions in scenario buildings. Scenarios are a way to develop alternative
futures based on different combinations of assumptions, facts and trends that will help the organizations
forecasting goals mentioned earlier. Scenarios are generally descriptive statements resenting a particular picture of
the future that includes comments on the probability of certain events occurring. Moreover, scenarios are usually
accompanied by qualitative or quantitative information.

The next step after outlining best, worst and most likely scenarios is to create a preferred scenario detailing what
organization wants as an outcome taking into account the assumptions previously identified. Additionally use the
information from any warning indicators above which should be used to monitor changes consistent with
preferred outcome.

It will be useful to apply SWOT or PESTLE analysis to help through this phase. SWOT is an acronym for Strength,
Weakness, Opportunities and Treats. Strengths and Weaknesses are internal factors. Opportunities and Treats
are external factors. It is a simple technique as it uses four perspectives for decision-making and summarization.
For example what are the strengths, weakness, opportunities and threats of your scenario? This would be done for
each scenario suggesting the best, worst and most likely outcomes. PESTLE is essentially the same technique but is
useful for examining the external factors affecting a problem. The acronym stand for Political, Economic,
Sociological, Technological, Legal and Environmental.

The tools (SWOT and PESTLE) are useful for handling the qualitative data. Either tool will help to organize and
promote thinking about issues or problems that are facing the organization. It will help to clarify/identify the
organizations future trends and to apply to those trends to the organization to help explicitly identify any
underlying assumptions and to set priorities. The using the SWOT analysis, step one is to identify organizations
assumptions and utilize the matrix using the demands and supply information obtained in the analysis phase. Step
two is to identify organizations assumptions/key workforce issues from step one and take into account the
potential impact on your business elements, potential impact on assumptions, risk inherent in the assumptions and
the likelihood of its occurrence.

The final phase of forecasting is performing Gap Analysis. After completing your preferred scenario the
organization need to look back at your current workforce and your future demands to identify any gaps in skills,
people needed to meet preferred scenarios etc. Demand is based on the preferred scenario and competencies/skills
need to meet demand requirements. The Gap Analysis should indicate the skills gap, surplus any recruitment issues
and retentions issues to meet the demand etc. Organization should continue this exercise for each scenario until
you have developed your suggested strategy/initiative/action to deal with the preferred outcomes to meet
organizations needs.

Techniques of Forecasting
The HRP must lead an organization through the process of determining how many employees the organization
needs and the characteristics that those employees should have to facilitate the accomplishment of organizational.
Human Resources Planning is the process of determining how to staff the organization with the right employees at
the right time and in the right place. HR planning is increasingly indistinguishable from organizational strategic
planning in those organizations where human capital is the critical factor in organizational success. For the
purposes of discussion and explanation in this section, it is assumed that organization has completed its strategic-
planning process and determined its strategic goals and objectives. The purpose of workforce planning then
becomes to determine the characteristics needed in the organizations workforce to facilitate achievement of those
objectives. In this scenario, workforce planning is strategic planning at the HR level and involves similar processes,
including a SWOT analysis, which occurs at the organizational level. In simplistic terms, the HR function must
determine the numbers and types of employees needed and evaluate the availability of both internal and external
individuals having the correct characteristics. Based on these analyses, a determination can be made as to the
proper HR programmatic activities required to achieve the correct workforce composition. Workforce planning
then involves three stages: forecasting workforce needs, determining internal and external supply of employees,
and developing appropriate strategies to achieve forecasted needs in relationship to projected supply. These three
processes are discussed in the following sections.

Forecasting Workforce Needs

The organizations strategic plan and allied business plan provide guidance as to the number and type of employees
that the organization needs during the planning period. Expansion, retrenchment, new products or services,
introduction of new technology, entrance of new competitors in the market, economic conditions, employee
retirements, workforce turnover, and so forth must be considered when forecasting workforce needs. Forecasting is
the process of using both historical data and predicted scenarios to determine workforce needs during a stated
planning period. Following is a discussion of several forecasting methods that are often used.

Trend Analysis

Trend analysis involves studying historical organizational employment levels to predict future employment levels.
For example: If, on average, employment levels in the organization have increase 5% per year, it might be logical to
forecast a 5% increase for the next planning period. A more accurate forecast using this method might be to
evaluate trends in separate departments or other organizational subentities and then aggregate the increases (or,
potentially, decreases) at the organizational level. Doing so provides more specificity as to not only the numbers of
employees but also the types of employees needed.

Trend analysis assumes that history will repeat itself. In todays more volatile times that might not be the case.
However, trend analysis provides some data on which a final forecast can be made.

Ratio Analysis

Ratio analysis is a forecasting technique that assumes a set relationship between one variable and nother, and that
the relationship allows for the prediction of workforce needs. Assuming no increases in productivity, an
organization might be able to predict total workforce requirements based on predicted total sales or total
productivity. For example: If, historically, it takes five employees for each 100,000 unit of product produced, a
projected increase of 1,000,000 units per year will require an additional 50 employees. Organizations often have
standard staff tables that can be used in ratio analysis. As an example, a restaurant chain would know how many
servers, cooks, managers, and so forth are needed to staff a restaurant. Based on a projected expansion in terms of
number of restaurants, increase in workforce needs can be forecast.


Analysis of historical turnoverin reality a type of trend analysisprovides additional data for forecasts. Average
turnover rates provide an indication of the number of new employees required just to maintain current
employment levels. Obviously, turnover is affected by many environmental factors, most notably unemployment
rates, so other variables must be considered when using these data for forecasting.

Nominal Group Technique

The nominal group technique is a group-forecasting and decision-making method that requires each member of the
group to make an independent forecast prior to discussion of any forecasts. Members of the group meet and
independently develop a forecast. Each member must present his or her forecast before any of the forecasts are
discussed. After all presentations are made and clarifying questions addressed, the group works to come up with a
final forecast.

Delphi Technique

The Delphi technique is another group forecasting method in which experts independently develop forecasts that
are shared with each other, but in this approach the experts never actually meet. Each of the members refines his or
her forecasts until a group consensus is reached.

Group Think

The nominal group and Delphi techniques are used to avoid the phenomenon known as group think. Group think
occurs when group members, in the interest of developing group cohesiveness, reach consensus without fully
considering what might be divergent forecasts.

Managerial Judgment

Managers and executives are asked, based on their experience and knowledge, to develop forecasts. Forecasts, like
budgets, can be a top-level overall estimate or a bottom-up aggregation of multiple departmental estimates. Top-
level forecasts provide a gross indicator of needed employment levels, but do not indicate where those employees
should be allocated in the organization. Bottom-up forecasts, provided by managers in the various departments,
provide a better idea of allocation of the workforce and the types of employees that are needed. However, bottom-
up forecasts tend to overestimate workforce needs as each manager tries to increase staff size.

Statistical Forecasts

Statistical analysis was discussed in Chapter 2 in the section on research. Various statistical procedures, including
regression analyses, can be used to develop forecasts based on scenarios or theorized relationships between

Computer Modelling

Many organizations use sophisticated forecasting software. This permits the organizations to evaluate workforce
needs under various scenarios.

Multiple Methods

In the final analysis, no single forecasting method is likely to be accurate every time. Most organizations use
multiple methods to develop different forecasts. Ultimately, it is likely to be a top-level manager, using intuition
based on accumulated knowledge and years of experience, that makes the final determination of the most likely

Determining Internal and External Supply of Employees

Not only must the demand for employees be determined, but workforce planning must include an analysis of the
potential supply. Forecasts must be made of the supply of candidates for jobs within the organization and the
supply external to the organization in the relevant labour market. Methods of forecasting supply, internally and
externally, are discussed in the following section.

Internal Supply

The internal supply of candidates can be determined using a number of methods, such as replacement charts,
succession plans, human resource management information systems, and departmental estimates. A brief
discussion of each of these methods follows.

Replacement Charts
Replacement charts are manual or automated records indicating which employees are currently ready for
promotion to a specific position. If needs are forecasted for a particular job, replacement charts provide data with
which to determine the supply of internal candidates to fill the openings.

Succession Planning

The concept of succession planning is similar to replacement charting except the time perspective is
different. Succession planning is the process of identifying candidates for future openings. It is a longer-term plan
for developing candidates to fill positions. Traditionally, succession planning has been reserved for only high-level
positions. However, because of the increased importance of human capital in many organizations, succession plans
are being developed for the orderly replacement of lower-level employees.

Human Resource Management Information Systems

Many human resource management information systems frequently contain data on qualifications or skills of
current employees. After workforce demand is forecast, the database can be queried regarding the supply of
potential internal candidates that possess the necessary qualifications or skills.

Departmental Estimates

Organizations are not static. Most organizations and their component departments experience constant flows of
employees both in and out. Analysis of this movement provides valuable information to forecast internal supply.

External Supply

There is a huge amount of information available to assist in the forecasting external supplies of labour. State and
local economic and workforce development agencies typically can provide data on the labour supply availability.
The department of labour has data available for virtually any location and publishes annual forecasts of labour
supply by occupation, and the Bureau of Labour Statistics provides a wide variety of labour force information that
is available online. In addition, various professional organizations regularly analyze labour availability within their
respective professions. The availability of external candidates is affected by:

Economic conditions.
Unemployment rates.
College and high school graduation rates in the relevant labour market.
Net migration in or out of the area.
Relative skill levels of potential candidates in the labour market.
Competition for labour in the labour market.
Changes in the skill requirements of the organizations potential job openings.
You should be familiar with the various methods of forecasting both demand for and supply of

employees and candidates.

Determination of Strategies

The analysis of demand and supply for labour leads the SPHR to develop appropriate strategies to achieve the
planned level of employment. The result of the analysis can result in one of three conditions:

Equality: In which case the strategy becomes one of retaining current employees.
Insufficient number of employees: In which case the strategy becomes recruitment.
Too many employees: In which case the strategy becomes decruitment.
Retention of employees involves strategies designed to maintain or improve job satisfaction and organizational
commitment. They are discussed throughout this entire book as they apply to a particular program area. For
example, retention strategies involve creating pay equity and providing desired benefits when compensation and
benefits strategies are being developed. Both recruitment and decruitment (organizational exit) are discussed later
in this chapter. It would be very similar if the analysis reveals that only one of the conditions from the preceding list
exists. However, that is not often the case and the SPHR frequently finds that some departments are currently
staffed appropriately for future needs during the planning period, whereas some departments have too many
employees and others too few. Thus, strategies of recruitment, decruitment, and retention must be developed
simultaneously and interdependently because the recruitment objectives of one department can often serve to
fulfill the decruitment objectives of another. It provides a basis for understanding two major programmatic
activities that are discussed later in this chapter: recruitment and selection. Assuming that an expansion of the
workforce is required, strategy determination is affected by the forecasts of yield rates and the timeframes required
for each step in the recruitment and selection process. Yield rates are a comparison of the number of applicants or
potential applicants at one stage in the recruitment/selection process with the number of applicants that remain
available at the next stage. To determine programmatic activities and action plans, the SPHR must work backward
from the total number and types of employees that will be needed, including dates on which they will be needed.
Based on experience, moderated by any projected changes in timeframes or yield rates, the planning process must
incorporate an evaluation of the scope and timing of activities to produce the desired results.

Planning: (Identification of Strategy)

After completing the surplus/demand analysis, gap analysis, scenario building exercise, SWOT etc. you will begin
the planning phase. Strategies, initiatives and programs and policies should be developed to address the gaps
identified in the analyzing phase. This will ensure that your element will recruit, develop and retain the critical staff
needed for a successful workforce plan. A few factors should be considered when deciding upon strategies to
address a workforce gap. Human resources planning should include a wide range of strategies around staff
development, succession planning, redeployment, recruitment, technology improvement, competitive sourcing,
changes in work practices etc. The organizational HR plans should be flexible to address workforce but it must be
quite realistic.
Implementating: Executing the New Strategies

After organization have analyzed, forecasted and planned, it is critically important to put together an
implementation plan to carry out the planned activities included in the human resources plan. This will be the
process of using all the information gathered in the previous phases and devising a plan to execute the new
strategies. There are a few basic considerations that should be addressed before beginning the implementation
plan. These includes organization support, allocating the different resources required, clarifying the roles and
responsibilities, identifying who is involved in implementing what and where coordination among different parts of
the organization or with different agencies is needed, establishing timeliness, determining performances measures
and communicating the plans.

Evaluating: Feedback on Effectiveness of Outcomes

Evaluation of organizations human resources plan is imperative in determining if the devised strategies are address
the gaps specified. It is important to obtain feedback concerning the effectiveness of outcomes. There are several
methods in getting feedback such as surveys, focus groups, meetings etc. regardless of the methods, effectiveness of

Human resource planning can improve operational efficiency and increase the profitability of a business
of any size. HR planning doesnt, however, include making staffing decisions on the fly. A strategic HR
policy can eliminate confusion, streamline the hiring process and save precious time for a small business
owner who never has enough of it. Including forecasting as an integral part of HR planning fulfills
efficiency and profitability objectives by ensuring the business is not overstaffed or understaffed.

Forecasting Basics
Forecasting is a systematic process of predicting demand and supply. Human resources forecasting seeks
to secure the necessary number and quality of employees for a business to achieve strategic goals.
Although forecasting techniques can be complex and full of statistical calculations, a more practical
approach is just as effective and less difficult for a small business to implement. Demand and supply
forecasting techniques use sales or production projections for the coming year as well as quantitative and
qualitative assessments. Quantitative assessments identify how many and when, while qualitative
assessments identify desired personal qualities and role-related qualifications.
Trend Analysis
Trend analysis is more appropriate for an existing business because it requires historical staffing data to
make future staffing predictions. This creates a relationship between past and future staffing needs by
linking the two using a performance or financial metric called an operational index. A service business,
for example, might base future staffing requirements on the number of customers each customer service
representative effectively handled in the past, while a retail business might compare sales volume per
sales employee.

Ratio Analysis
A new businesses, or one having less than five years of historical staffing data, often uses a ratio analysis
forecasting technique. Ratio analysis uses elements called causal factors that can be linked to and help
predict future staffing needs. A business might identify production or sales volume as a causal factor and
estimate, for example, that it needs one customer service representative for every five clients or one
production line worker for every 5,000 widgets. If projections determine the business will handle 500
clients or produce 500,000 widgets over the coming year, forecasting sets demand at 100 employees for

Supply Forecasting
Supply forecasting techniques often start internally for human resources. Replacement charts are a visual
tool for identifying internal candidates available and qualified to fill demand estimations. Replacement
charts include both a hierarchical diagram and information relating to current employee performance,
education and an assessment of how ready the employee is to move into upward or lateral position.
External supply side forecasting typically involves a labor market analysis that also considers hiring
practice legislation to avoid the possibility of facing a discrimination lawsuit. Market analysis information
such as employment and wage trends is available on The Society for Human Resource Management
website, as well as national and state labor information websites. Information on these sites can help
businesses document the current strengths and weaknesses of the workforce, define emerging
employment trends and economic opportunities and assist businesses in finding qualified workers.

Human resources forecasting is critical for managing a fluid business environment and for supporting
strategic business plans. While getting the right people in the right places at the right time can be a
challenge for any size business, time and budget constraints can make HR forecasting especially trying for
small-business owners. A small upfront investment of time and modified techniques that dont require a
large budget can make HR forecasting less difficult for a small business and still produce accurate results.
Small-business entrepreneurs often operate in a dynamic, forward-moving environment characterized by
rapidly changing technologies, products and shifting markets. Although HR forecasting techniques still
include both quantitative and qualitative assessments, techniques that focus on qualitative data are more
flexible and allow small-business owners to respond more quickly to changing market conditions. Labor
market forecasts are valuable external data sources when using HR forecasting techniques that focus on
quantitative data.

Qualitative Forecasting Techniques

Replacement planning, allocation planning and nominal group techniques often work in combination.
Replacement planning is a charting technique that lists each business role according to department, notes
whether the role is currently filled and if so, provides relevant information about the employee holding
the position. Allocation planning looks to see if staffing needs can be met by reallocating current
employees or if the business needs to access the external labor force. Nominal group is a team-oriented
forecasting technique that provides the forecasting framework. For example, after conducting
replacement and allocation planning, a team that includes the business owner and department managers
can then hold a discussion about staffing requirements for the next reporting period and make
forecasting decisions together.

Quantitative Forecasting Techniques

Trend and ratio analyses are two of the most commonly used quantitative forecasting techniques. Trend
analysis is a more suitable technique for an existing business, because it uses historical staffing and sales
data to make forecasting predictions. Ratio analysis is a forecasting technique that new businesses or
those having less than five years of historical staffing data often use. Ratio analysis uses sales or service
projections to forecast future staffing needs. A business could determine, for example, it needs two sales
associates for every 30 customers and base forecasting predictions on these numbers.

Small-Business Forecasting Considerations

Large businesses most often conduct HR forecasting annually. This time frame can be difficult for small
businesses that either measure growth using a shorter time period or do not have enough historical data
to rely on to make long-range forecasting decisions. Adjusting the time frame so forecasting covers a
three- or six-month period can help small businesses with special needs make more accurate HR
forecasts. In addition, large-business HR forecasting techniques often use proprietary software packages
and subscribe to national or international databases for making numbers-oriented quantitative
forecasting assessments. Small-business owners can use the same techniques but at a reduced cost using
manual calculations or spreadsheet software and by getting data from regional or local government

What is Employee Relations ?

An organization cant perform only with the help of chairs, tables, fans or other non living entities. It
needs human beings who work together and perform to achieve the goals and objectives of the

The human beings working together towards a common goal at a common place (organization) are called
employees. Infact the employees are the major assets of an organization.

The success and failure of any organization is directly proportional to the labour put by each and every

The employees must share a good rapport with each other and strive hard to realize the goal of the
organization. They should complement each other and work together as a single unit. For the employees,
the organization must come first and all their personal interests should take a back seat.

What is Employee Relations ?

Every individual shares a certain relationship with his colleagues at the workplace. The relationship is
either warm, so-so or bad. The relationship can be between any one in the organization - between co
workers, between an employee and his superior, between two members in the management and so on. It
is important that the employees share a healthy relationship with each other to deliver their best

An individual spends his maximum time at the workplace and his fellow workers are the ones with whom
he spends the maximum hours in a day. No way can he afford to fight with his colleagues. Conflicts and
misunderstandings only add to tensions and in turn decrease the productivity of the individual. One
needs to discuss so many things at work and needs the advice and suggestions of all to reach to a solution
which would benefit the individual as well as the organization.

No individual can work alone. He needs the support and guidance of his fellow workers to come out with
a brilliant idea and deliver his level best.
Employee relations refer to the relationship shared among the employees in an organization. The
employees must be comfortable with each other for a healthy environment at work. It is the prime duty of
the superiors and team leaders to discourage conflicts in the team and encourage a healthy relationship
among employees.

Life is really short and it is important that one enjoys each and every moment of it.Remember in an
organization you are paid for your hard work and not for cribbing or fighting with each other. Dont
assume that the person sitting next to you is your enemy or will do any harm to you. Who says you cant
make friends at work, infact one can make the best of friends in the office. There is so much more to life
than fighting with each other.

Observation says that a healthy relation among the employees goes a long way in motivating the
employees and increasing their confidence and morale. One starts enjoying his office and does not take
his work as a burden. He feels charged and fresh the whole day and takes each day at work as a new
challenge. If you have a good relation with your team members you feel going to office daily. Go out with
your team members for a get together once in a while or have your lunch together. These activities help in
strengthening the bond among the employees and improve the relations among them.

An employee must try his level best to adjust with each other and compromise to his best extent possible.
If you do not agree to any of your fellow workers ideas, there are several other ways to convince him. Sit
with him and probably discuss with him where he is going wrong and needs a correction. This way he
would definitely look up to you for your advice and guidance in future. He would trust you and would
definitely come to your help whenever you need him. One should never spoil his relations with his
colleagues because you never know when you need the other person.

Avoid using foul words or derogatory sentences against anyone. Dont depend on lose talk in office as it
spoils the ambience of the place and also the relation among the employees. Blame games are a strict no
no in office.

One needs to enter his office with a positive frame of mind and should not unnecessarily make issues out
of small things. It is natural that every human being can not think the way you think, or behave the way
you behave. If you also behave in the similar way the other person is behaving, there is hardly any
difference between you and him. Counsel the other person and correct him wherever he is wrong.

It is of utmost importance that employees behave with each other in a cultured way, respect each other
and learn to trust each other. An individual however hardworking he is, cannot do wonders alone. It is
essential that all the employees share a cordial relation with each other, understand each others needs
and expectations and work together to accomplish the goals and targets of the organization.

Most Popular Approaches to Industrial

The three popular approaches to industrial relation are as follows: 1. Unitary Approach 2.
Pluralistic Approach 3. Marxist Approach.

Like other behavioural subjects, both the scenario of IR and factors affecting it are perceived
differently by different behavioural practitioners and theorists. For example, while some
perceive IR in terms of class conflict, others view it in terms of mutual co-operation, yet
others understand it related to competing interests of various groups and so.

An understanding of these approaches to HR helps the human resource manager in devising

an effective human resource strategy. Based on these perceptions, the behavioural theorists
have developed some approaches to explain the IR dynamics.

Among them, the popular approaches to IR are:

1. Unitary Approach 3. Marxist Approach

2. Pluralistic Approach

These are discussed one by one

1. Unitary Approach:

The Unitary approach to IR is based on the assumption that every one-be it employee,
employer or government-benefits when emphasis is on common interest. Alternatively
speaking, under unitary approach, IR is founded on mutual co-operation, team work, shared
goal, and so.

Conflict at work place, if any, is seen as a temporary aberration resulting from poor
management or mismanagement of employees. Otherwise, employees usually accept and
cooperate with management. Conflict in the form of strikes is disregarded as destructive.

Alwar plant of Eitcher Tractors represents one such example of unitary approach.
Nonetheless, unitary approach is criticised mainly on two grounds. First, it is used as a tool for
keeping employees at bay from unionism. Second, it is also seen as exploitative and

2. Pluralistic Approach:

In fact, pluralistic approach is a departure from unitary approach of IR. This approach war
evolved and practiced in mid 1960s and early 1970s in England. Later, this approach was
developed by me British scholars in particular by A. Fox the approach perceives that
organisation is a coalition of competing interest groups mediated by the management. At
times, it may so happen that management in its mediating role may pay insufficient attention
to the needs and claims of employees.

In such a situation, employees may unite in the form of trade unions to protect their needs
and claims. As a result, trade unions become the legitimate representatives of employees in
the organisation. Thus, the system of IR gets grounded on the product of concessions and
compromises between management and trade unions.

Conflict between employees and management understood as competing interest groups, is

considered as inevitable and, in fact, necessary also. Normally, employees are not that much
forceful in negotiation process as much management is. Hence, employees join trade unions to
negotiate with management on equal terms to protect their interests.

Like unitary approach, pluralistic approach also suffers from certain limitations. The basic
assumption of this approach that, employees and management do not arrive at, an acceptable
agreement do not hold good in a free society. This is because a society may be free, but power
distribution is not necessarily equal among the competing forces.

The experience of England where this approach was involved and developed in mid sixties
and early seventies faced widespread strikes substantiates that pluralistic approach is a costly
affair, at least, in short run if not in long-run.

3. Marxist Approach:

Like pluralists, marxists also view conflict between labour and management as inevitable. But
marxists unlike pluralists, regard conflict as a product of the capitalist society based on
classes. According to marxists conflict arises because of division within society in terms of
haves i.e., capitalists and have nots i.e., labour. The main objective of capitalists has been to
improve productivity by paying minimum wages to labour. Labour views this as their
exploitation by the capitalists.

The marxists do not welcome state intervention as, in their view, it usually supports
managements interest. They view the pluralistic approach is supportive of capitalism and the
unitary approach as an anathema. Therefore, the labour-capital conflict, according to marxist
approach, cannot be solved by bargaining, participation and cooperation.

In such situation, trade union comes in picture and is seen as a reaction to exploitation by
capitalists and also a weapon to bring a revolutionary social change by changing capitalistic
system. For this, coercive powers such as strikes, gherao, etc. are exercised by the labour
against capitalists.

Such systems of IR have been very much observed in most of the socialist countries like
erstwhile USSR. The marxist approach is mainly practised in communist bloc. Hence the scope
of marxist approach remains limited to the countries based on socialism.

Types of Collective Bargaining

Definition: The Collective Bargaining is the process wherein the unions (representatives of
employees or workers), and the employer (or their representative) meet to discuss the
issues related to wage, the number of working hours, work environment and the other
terms of the employment.

There are four types of Collective Bargaining classified on the basis of their nature and the
objectives, and can be practiced depending on the different situation requirements.

Types of Collective Bargaining

1. Conjunctive or Distributive Bargaining: In this form of collective bargaining, both the parties
viz. The employee and the employer try to maximize their respective gains. It is based on the principle,
my gain is your loss, and your gain is my loss i.e. one party wins over the other.

The economic issues such as wages, bonus, other benefits are discussed, where the
employee wishes to have an increased wage or bonus for his work done, whereas the
employer wishes to increase the workload and reduce the wages.

2. Co-operative or Integrative Bargaining: Both the employee and the employer sit together and
try to resolve the problems of their common interest and reach to an amicable solution. In the case of
economic crisis, such as recession, which is beyond the control of either party, may enter into a mutual
agreement with respect to the working terms.

For example, the workers may agree for the low wages or the management may agree to
adopt the modernized methods, so as to have an increased production.

3. Productivity Bargaining: This type of bargaining is done by the management, where the workers
are given the incentives or the bonus for the increased productivity. The workers get encouraged and
work very hard to reach beyond the standard level of productivity to gain the additional benefits.

Through this form of collective bargaining, both the employer and the employee enjoy the
benefits in the form of increased production and the increased pay respectively.
4. Composite Bargaining: In this type of collective bargaining, along with the demand for increased
wages the workers also express their concern over the working conditions, recruitment and training
policies, environmental issues, mergers and amalgamations with other firms, pricing policies, etc. with
the intention to safeguard their interest and protect the dilution of their powers.

Thus, the purpose of the Collective Bargaining is to reach a mutual agreement between the
employee and the employer with respect to the employment terms and enjoy a long term
relationship with each other.

Process of Collective Bargaining

1. Preparation: At the very first step, both the representatives of each party prepares the negotiations
to be carried out during the meeting. Each member should be well versed with the issues to be raised at
the meeting and should have adequate knowledge of the labor laws.

The management should be well prepared with the proposals of change required in the employment
terms and be ready with the statistical figures to justify its stand.

On the other hand, the union must gather adequate information regarding the financial position of the
business along with its ability to pay and prepare a detailed report on the issues and the desires of the

2. Discuss: Here, both the parties decide the ground rules that will guide the negotiations and the
prime negotiator is from the management team who will lead the discussion. Also, the issues for which
the meeting is held, are identified at this stage.

The issues could be related to the wages, supplementary economic benefits (pension plans, health
insurance, paid holidays, etc.), Institutional issues(rights and duties, ESOP plan), Administrative
issues (health and safety, technological changes, job security, working conditions).

3. Propose: At this stage, the chief negotiator begins the conversation with an opening statement and
then both the parties put forth their initial demands. This session can be called as a brainstorming, where
each party gives their opinion that leads to arguments and counter arguments.
4. Bargain: The negotiation begins at this stage, where each party tries to win over the other. The
negotiation can go for days until a final agreement is reached. Sometimes, both the parties reach an
amicable solution soon, but at times to settle down the dispute the third party intervenes into the
negotiation in the form of arbitration or adjudication.

5. Settlement: This is the final stage of the collective bargaining process, where both the parties agree
on a common solution to the problem discussed so far. Hence, a mutual agreement is formed between the
employee and the employer which is to be signed by each party to give the decision a universal

Thus, to get the dispute settled the management must follow these steps systematically and give equal
chance to the workers to speak out their minds.

Training Methods: On Job Training and off

the Job Training Methods
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Training Methods: On Job Training and off the Job Training Methods!
A large variety of methods of training are used in business. Even within one organization
different methods are used for training different people. All the methods are divided into two
classifications for:

A. On-the-job Training Methods:

1. Coaching 4. Job Instruction Technology

2. Mentoring 5. Apprenticeship

3. Job Rotation 6. Understudy

B. Off-the-Job Training Methods:

1. Lectures and Conferences 2. Vestibule Training
3. Simulation Exercises 5. Transactional Training

4. Sensitivity Training
A. On-the-job training Methods:

Under these methods new or inexperienced employees learn through observing peers or
managers performing the job and trying to imitate their behaviour. These methods do not cost
much and are less disruptive as employees are always on the job, training is given on the same
machines and experience would be on already approved standards, and above all the trainee
is learning while earning. Some of the commonly used methods are:

1. Coaching:
Coaching is a one-to-one training. It helps in quickly identifying the weak areas and tries to
focus on them. It also offers the benefit of transferring theory learning to practice. The biggest
problem is that it perpetrates the existing practices and styles. In India most of the scooter
mechanics are trained only through this method.

2. Mentoring:
The focus in this training is on the development of attitude. It is used for managerial
employees. Mentoring is always done by a senior inside person. It is also one-to- one
interaction, like coaching.

3. Job Rotation:
It is the process of training employees by rotating them through a series of related jobs.
Rotation not only makes a person well acquainted with different jobs, but it also alleviates
boredom and allows to develop rapport with a number of people. Rotation must be logical.
4. Job Instructional Technique (JIT):
It is a Step by step (structured) on the job training method in which a suitable trainer (a)
prepares a trainee with an overview of the job, its purpose, and the results desired, (b)
demonstrates the task or the skill to the trainee, (c) allows the trainee to show the
demonstration on his or her own, and (d) follows up to provide feedback and help. The
trainees are presented the learning material in written or by learning machines through a
series called frames. This method is a valuable tool for all educators (teachers and trainers).
It helps us:

a. To deliver step-by-step instruction

b. To know when the learner has learned

c. To be due diligent (in many work-place environments)

5. Apprenticeship:
Apprenticeship is a system of training a new generation of practitioners of a skill. This method
of training is in vogue in those trades, crafts and technical fields in which a long period is
required for gaining proficiency. The trainees serve as apprentices to experts for long periods.
They have to work in direct association with and also under the direct supervision of their

The object of such training is to make the trainees all-round craftsmen. It is an expensive
method of training. Also, there is no guarantee that the trained worker will continue to work
in the same organisation after securing training. The apprentices are paid remuneration
according the apprenticeship agreements.

6. Understudy:
In this method, a superior gives training to a subordinate as his understudy like an assistant
to a manager or director (in a film). The subordinate learns through experience and
observation by participating in handling day to day problems. Basic purpose is to prepare
subordinate for assuming the full responsibilities and duties.
B. Off-the-job Training Methods:
Off-the-job training methods are conducted in separate from the job environment, study
material is supplied, there is full concentration on learning rather than performing, and there
is freedom of expression. Important methods include:

1. Lectures and Conferences:

Lectures and conferences are the traditional and direct method of instruction. Every training
programme starts with lecture and conference. Its a verbal presentation for a large audience.
However, the lectures have to be motivating and creating interest among trainees. The
speaker must have considerable depth in the subject. In the colleges and universities, lectures
and seminars are the most common methods used for training.

2. Vestibule Training:
Vestibule Training is a term for near-the-job training, as it offers access to something new
(learning). In vestibule training, the workers are trained in a prototype environment on
specific jobs in a special part of the plant.

An attempt is made to create working condition similar to the actual workshop conditions.
After training workers in such condition, the trained workers may be put on similar jobs in
the actual workshop.

This enables the workers to secure training in the best methods to work and to get rid of
initial nervousness. During the Second World War II, this method was used to train a large
number of workers in a short period of time. It may also be used as a preliminary to on-the
job training. Duration ranges from few days to few weeks. It prevents trainees to commit
costly mistakes on the actual machines.

3. Simulation Exercises:
Simulation is any artificial environment exactly similar to the actual situation. There are four
basic simulation techniques used for imparting training: management games, case study, role
playing, and in-basket training.
(a) Management Games:
Properly designed games help to ingrain thinking habits, analytical, logical and reasoning
capabilities, importance of team work, time management, to make decisions lacking complete
information, communication and leadership capabilities. Use of management games can
encourage novel, innovative mechanisms for coping with stress.

Management games orient a candidate with practical applicability of the subject. These games
help to appreciate management concepts in a practical way. Different games are used for
training general managers and the middle management and functional heads executive
Games and functional heads.

(b) Case Study:

Case studies are complex examples which give an insight into the context of a problem as well
as illustrating the main point. Case Studies are trainee centered activities based on topics that
demonstrate theoretical concepts in an applied setting.

A case study allows the application of theoretical concepts to be demonstrated, thus bridging
the gap between theory and practice, encourage active learning, provides an opportunity for
the development of key skills such as communication, group working and problem solving,
and increases the trainees enjoyment of the topic and hence their desire to learn.

(c) Role Playing:

Each trainee takes the role of a person affected by an issue and studies the impacts of the
issues on human life and/or the effects of human activities on the world around us from the
perspective of that person.

It emphasizes the real- world side of science and challenges students to deal with complex
problems with no single right answer and to use a variety of skills beyond those employed
in a typical research project.

In particular, role-playing presents the student a valuable opportunity to learn not just the
course content, but other perspectives on it. The steps involved in role playing include
defining objectives, choose context & roles, introducing the exercise, trainee
preparation/research, the role-play, concluding discussion, and assessment. Types of role play
may be multiple role play, single role play, role rotation, and spontaneous role play.

(d) In-basket training:

In-basket exercise, also known as in-tray training, consists of a set of business papers which
may include e-mail SMSs, reports, memos, and other items. Now the trainer is asked to
prioritise the decisions to be made immediately and the ones that can be delayed.

4. Sensitivity Training:
Sensitivity training is also known as laboratory or T-group training. This training is about
making people understand about themselves and others reasonably, which is done by
developing in them social sensitivity and behavioral flexibility. It is ability of an individual to
sense what others feel and think from their own point of view.

It reveals information about his or her own personal qualities, concerns, emotional issues,
and things that he or she has in common with other members of the group. It is the ability to
behave suitably in light of understanding.

A groups trainer refrains from acting as a group leader or lecturer, attempting instead to
clarify the group processes using incidents as examples to clarify general points or provide
feedback. The group action, overall, is the goal as well as the process.

Sensitivity training Program comprises three steps (see Figure 18.7)

5. Transactional Analysis:
It provides trainees with a realistic and useful method for analyzing and understanding the
behavior of others. In every social interaction, there is a motivation provided by one person
and a reaction to that motivation given by another person.

This motivation reaction relationship between two persons is known as a transaction.

Transactional analysis can be done by the ego (system of feelings accompanied by a related
set of behaviors states of an individual).
It is a collection of recordings in the brain of an individual of behaviors, attitudes, and
impulses which come to him/her naturally from his/her own understanding as a child. The
characteristics of this ego are to be spontaneous, intense, unconfident, reliant, probing,
anxious, etc. Verbal clues that a person is operating from its child state are the use of words
like I guess, I suppose, etc. and non verbal clues like, giggling, coyness, silent, attention
seeking etc.

It is a collection of recordings in the brain of an individual of behaviors, attitudes, and
impulses imposed on her in her childhood from various sources such as, social, parents,
friends, etc.

The characteristics of this ego are to be overprotective, isolated, rigid, bossy, etc. Verbal clues
that a person is operating from its parent states are the use of words like, always, should,
never, etc and non-verbal clues such as, raising eyebrows, pointing an accusing finger at
somebody, etc.

It is a collection of reality testing, rational behaviour, decision making, etc. A person in this ego
state verifies, updates the reaction which she has received from the other two states. It is a
shift from the taught and felt concepts to tested concepts.

All of us show behaviour from one ego state which is responded to by the other person from
any of these three states.

Types of evaluation
Evaluating the Training (includes monitoring) addresses how one determines whether the goals or objectives were
met and what impact the training had on actual performance on the job.

Generally there are four kinds of standard training evaluation:

1. Formative

2. Process

3. Outcome

4. Impact.

1. Formative evaluation provides ongoing feedback to the curriculum designers and developers to ensure that
what is being created really meets the needs of the intended audience.

2. Process evaluation provides information about what occurs during training. This includes giving and
receiving verbal feedback.

3. Outcome evaluation determines whether or not the desired results (e.g., what participants are doing) of
applying new skills were Achieved in the short-term.

4. Impact determines how the results of the training affect the strategic goal

Evaluation Methods

Evaluation methods can be either qualitative (e.g., interviews, case studies, focus groups) or quantitative
(e.g., surveys, experiments)

Training evaluation usually includes a combination of these methods and reframes our thinking about
evaluation in that measurements are aimed at different levels of a system.

Formative Evaluation

Formative Evaluation may be defined as any combination of measurements obtained and judgments made
before or during the implementation of materials, methods, or programs to control, assure or improve the quality
of program performance or delivery.

It answers such questions as, Are the goals and objectives suitable for the intended audience? Are the
methods and materials appropriate to the event? Can the event be easily replicated?

Formative evaluation furnishes information for program developers and implementers.

It helps determine program planning and implementation activities in terms of (1) target population, (2)
program organization, and (3) program location and timing.
It provides short-loop feedback about the quality and implementation of program activities and thus becomes
critical to establishing, stabilizing, and upgrading programs.

Process Evaluation

Process Evaluation answers the question, What did you do? It focuses on procedures and actions being
used to produce results.

It monitors the quality of an event or project by various means. Traditionally, working as an onlooker, the
evaluator describes this process and measures the results in oral and written reports.

Process evaluation is the most common type of training evaluation. It takes place during training delivery
and at the end of the event.

Outcome Evaluation

Outcome Evaluation answers the question, What happened to the knowledge, attitudes, and behaviors of the
intended population?

This project would produce both outcomes and impacts.

Outcome evaluation is a long-term undertaking.

Outcome evaluation answers the question, What did the participants do?

Because outcomes refer to changes in behavior, outcome evaluation data is intended to measure what training
participants were able to do at the end of training and what they actually did back on the job as a result of the

Impact Evaluation takes even longer than outcome evaluation and you may never know for sure that your project
helped bring about the change.

Impacts occur through an accumulation of outcomes.

Major Challenges Faced by Human

Resource Managers
1. Recruitment and Selection:
Finding a suitable candidate for the job from a large number of applicants is a basic problem
for the human resource manager. They have to make suitable changes from time to time in the
selection procedure and see to it that the candidate is up to the mark fulfilling the job
requirements. If required, the candidate should be provided with training to get quality

2. Emotional and Physical Stability of Employees:

Providing with wages and salaries to employees is not sufficient in todays world. The human
resource manager should maintain proper emotional balance of employees. They should try
to understand the attitude, requirements and feelings of employees, and motivate them
whenever and wherever required.

3. Balance Between Management and Employees:

The human resource manager has a responsibility to balance the interest of management and
employees. Profits, commitment, cooperation, loyalty, and sincerely are the factors expected
by management, whereas better salaries and wages, safety and security, healthy working
conditions, career development, and participative working are the factors expected by
employees from management.

4. Training, Development and Compensation:

A planned execution of training programmes and managerial development programmes is
required to be undertaken to sharpen and enhance the skills, and to develop knowledge of
employees. Compensation in the form of salary, bonus, allowances, incentives and perquisites
is to be paid according to the performance of people. A word or letter of appreciation is also to
be given, if some of them have done their jobs beyond expectations to keep their morale up.

5. Performance Appraisal:
This activity should not be considered a routine process by the human resource manager. If
employees are not getting proper feedback from them, it may affect their future work. A
scientific appraisal technique according to changing needs should be applied and the quality
of it should be checked from time to time.
6. Dealing with Trade Union:
Union members are to be handled skillfully as they are usually the people who oppose the
company policies and procedures. Demands of the union and interests of the management
should be matched properly.