UTU-MBA

Q.1 what is strategic human resources management.

Human resources refer to the people who work in an organization this is the most valuable
source of management. Human resource management is concerned with the holistic approach
towards the management of people working in an organization. HR strategy is concerned with
two key elements

1. Determining the strategic objectives

2. Developing a plan of action
Stratetegic human resource management is an approach which relates to the
decisions about the nature of employment relationship and recruitment training
development performance management reward and employee relations. This
definition implies the following four components of SHRM-
1. The activities highlight the HR programmes policies and practice the means
which the people of the organization can be deployed to gain competitive
advantage.
2. It focuses on an organization’s human resources as the primary source of
competitive advantage of the organization.
3. The pattern and plan imply that there is a fit between HR strategy and
organization business strategy and between of all HR activities.
4. The people and practices and planned pattern are all purposeful that is directed
towards the achievement of the goals of the organization.
VRIO framework of human asset
It covers four basic requirements
Value- value is created either by decreasing the cost of product or service by
providing a unique product to customer that allows the organization to charge
a premium price. This is the very basic requirement. A company has its own
value and it has to create the value if it has to survive in market’ human
resourceis a major factor in total quality management people can contribute
much in efficiency of organization.
Rareness- Human resource is the efficient and it has the value but it will be
lost the value will be lost if the same human resource is found in same
competitive firms the human resource should be rare like more efficient, more
skilled able persons in the organizations.
Imitability- A unique history or culture is difficult to imitate and can be used
to get the high levels of performance and commitment from the employees.
Organizations- The organization should be managed properly so the
everything should be in proper system that HR practices should be exploited
easily Team work should be there in organization.

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Objectives of SHRM_
1. To ensure the availability of a skilled committed and highly motivated
workforce in the organization to achieve sustained competitive advantage.
2. To provide direction to the organization so that both the business needs of
the organization and the individual and collective needs of its workforce
are met. This is achieved by developing and implementing HR practices
that are strategically aligned.
BEST FIT APPROACH OF SHRM-

It comprises on HR approach and business strategies. Best fit means HR strategies should match with
the stages of n organization selects development of the firm.

Basis of classification of HR strategies

Different types of business strategies- business strategies adopted by the
firms depends upon the HR like if the company wants to expand the
business than it will have to make new employees in firm.
Stage of product development
If the product is in a growth stage then the organization will recruit
more employees the HR policy depends upon the product cycle whether it
is in introductory, growth, maturity or decline stage.

Drawbacks of Best Fit approach- it implies that an organization performance will improve
when HR practices will have competitive advantage the competitive strategy has been criticized
on a number of grounds and the model creates a typology and it is viewed as lacking attending
the exact human resource management.

Question 2
HR Outsourcings

Outsourcing is the permanent contracting out of activities that were previous performed
in house. Organization surveys, reward programs employees selection are some activities which
are outsourced by a company to a company. The trend is being used globally as also in India.
The objectives are

1. Reduce overhead and gain value for money the reason is that the cost is reduced because
there is no need to have a separate department of human resource for all these activities
you just have to pay for the work which you want that another company will do for you.
2. Focus on certain skills and competencies and outsource the others- It will be better to
concentrate on developing some of the skills and an organization can concentrate on the
proper and focused work which it is doing and can outsource another work to another
company.

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3. React better to external environment- such as labour market situation which also affect
the outsourcing decision. When labour supply is high any recruitment effort will generate
large number of applicants. This will require much processing. Therefore it would be
prudent for the firm to use the services of a recruitment consultancy.
4. Participate in economic reshaping because in-house activities are moving out to
independent suppliers.
Outsourcing of HR activities is a form of virtual HR as network based structure.
Here are some benefits and drawbacks of outsourcing/
Benefits of outsourcing
1- Outsourcing helps to meet the demand of efficiency and strategic support. It
can help an organization reduce costs by externalizing routine, administrative
task that do not directly contribute to the competitive success of the firm.
2- Outsourcing allows managers to allocate resource on just in time basis.
Certain HR services are needed infrequently or for only a short period.
3- Certain specialized HR services that the organization cannot perform
internally may be provided by external vendors who perform these services
better and more efficiently.
Drawbacks-
1-Outsourcing decisions are too often driven by cost consideration rather than
broader strategic consideration. The cost is reduced only for a short period and
actual in long term cost increases.

2-When specific HR functions are externalized there is a significant possibly

that the firm loses operating control over these functions.
4- When there is continued reliance on external source by a firm the HR
function’s ability to execute activities critical to competitiveness may actually
can not be able to be appraised. If outsourcing is not managed properly there
would be great loss to the company.

QUESTION 3-what is human resource planning and

what are significance of human resource planning?
Human resource planning is the process of analyzing and identifying the
need for and availability of human resources of firms and develop strategies
those requirements so that the organizations achieve its objectives.
It helps determine the HR requirements of firm.
Significance of human resource planning
1 Competitive business environment- Globalization of the economy has
increased cost and revenue. Due to proper planning an organization can
analyze the better way of managing the human resource in the competitive
environment.

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2- Manufacturing economy or service economy- There are more jobs in

service sector rather than manufacturing sector. The growth of service sector
has resulted in a shortage of engineers available to work in the manufacturing
sector. The changing pattern of industrial employment affects the pattern of
the different occupational groups. The occupational shift from manufacturing
sector to service sector has resulted in increased focus on competencies.
3- Technological advancements- Advancement in technology has resulted in
change in the nature of current jobs. Now the firms require tech savvy people
in future and for this they need to interact with the educational institutes like
IBM, Microsoft and oracle.
4 Increases productivity - Labour productivity in Indian industries has
increased steadily since the mid nineties. In the service sector there is a rise in
labour product ivies mainly because of concentration in subsector like ITs that
are dependent on skilled labour. This has led to a slow growth of jobs in
service sector also.
5 Labour marker changes- A labour market is the region where demand and
supply of labour meet. It affects the supply of labour in firm in terms of its
characteristics gender ,age etc. ,
Objectives of human resource planning
1 preventing organization from overstaffing and understaffing
2 to ensure employee availability
3 to ensure that the organization is responsive to the environment
4 to provide direction to all HR activities
5 to build line and staff partnership

.Question 4 Define Manpower Planning. What are the activities

involved in manpower planning? Explain the importance of macro
level manpower planning in India
Ans. Definition: Manpower planning is a primary resource without manpower resources,
Physical and financial etc. cannot be put into use. Manpower Planning is also known as
Human Resource Planning.

According to Strainer “Manpower Planning is the strategy for the acquisition movement and
preservation movement and preservation of an organization’s human resources.”

Activities required for Manpower Planning: Manpower planning consists of a series of

activities, listed as following ways.

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(a) Forecasting future manpower requirements: Forecasting future based on

judgmental estimates. Mathematical projections are done extrapolating factors like
Economic environment, development trends in industry etc. On the other hand
Judgmental estimates are done depending on the specific future plans of a company
by managerial discretion which is based on past experience.
(b) Preparing an inventory of present manpower: Such inventory contains data about
each employee’s skills, abilities, work preferences and other items of information.
(c) Anticipating problems of manpower: This can done by projecting present resources
into the future and comparing the same with the forecast of manpower requirements.
This helps in determine the quantitative and qualitative adequacy of manpower.
(d) Meeting Manpower requirements: This can be achieved through planning,
recruitment and selection, training & development, introduction and placement<
promotion and transfer, motivation and compensation to ensure that future manpower
requirements are correctly met.
(e)
HRP are both macro and micro level issues. Macro level includes demographic changes, legal
central, policies and markets technology etc. Micro level includes organizational restructuring,
skill, strategic objective, trade unions etc.

Macro is uncontrollable factor and Micro level is controllable factor.

Macro Level plays an important level in India. Development of human resources is one of the
important objectives of any country for long term economic growth. For a developing economy
like India such important is for more. This is more visible from our economic planning as
governments over the years have been giving increasing priority to population planning and
control, education, health, housing etc.

 Population Planning and control: To enforce control over population explosion to q

Economic imbalances, population planning and control measures have been initiated by
the Government. Unless such control is enforced in a planned manner in a planned
manner, no amount of institutional support can sustain this resulting in generation of
unproductive population which will remain a drain on our national resource.
 Literacy and Education: To develop human resource at the macro level, the
Government of India has adopted a National Policy on Education in 1986. The policy
provides a broad framework for complete eradication of illiteracy in the country by
declaring basic primary level education up to standard V, free and compulsory to
strengthen institutional infrastructure for education, the policy emphasizes on increased
government and non-government expenditure.
 Health and Medical-care: health sector reforms are another required initiative de
human resources at the macro level. In this respect, India has recorded disparity and
regional balances. Although there is an increased allocation of 36.9% in 2000-2001 over

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1999-2000 for central sector health services, at the state level the situation is very
depressive. Few positive changes in life expectancy ratio, in fact mortality rate, child
mortality rate etc.
 Housing: In housing, Government has renewed its efforts by adopting the National
Housing and habitat policy 1998. The basic thrust of this policy is to achieve sustainable
development of housing infrastructure through public-private partnership.
Macro level HRP is a complex and dynamic process and it requires longitudinal study to
understand the results of various policy measures and actions.

Macro level HRP Model divide in two parts:

- The manpower requirement approach (MRA)

- The rate of return approach (RRA)
RRA is also known as cost benefit analysis of Human Capital.

By establishing a linear relationship between the manpower category in different industry

groups and their output, MRA helps us to project the demand for manpower at the macro
level.

Rate of Return Approach (RRA): RRA analysis of human capital is applied to decide the
aggregate investment requirement for different skill development.

Conclusion: Manpower is a very important source.

Question5 what job analysis is and describe the process of job

analysis?

A systematic process by which management gathers and analyses information related to the task,
duties, and responsibilities of the jobs within the organization. Some information are obtained
through job analysis-
Job content- includes following aspects
Duties and responsibilities and the time period when these activities are performed.
Job demands- like sensing, deciding or other job demands.
Machines, tools, and equipments and the service rendered such as counseling.
Performance standards for appraising employees.
Process of job analysis-
1- determine purpose of job analysis- for example is the purpose to
specify performance standards or to compare jobs for compensation
purposes.

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2- Review organization chart- organization charts show the division of

work in the organization how the job in question relates to other jobs
how the jobs fits into the overall organization who reports to whom
and whom the jobholder reports to.
3- Select representatives jobs for analysis- when there are several similar
jobs to analyze it may be unnecessary to analyze all of them
4- Analyze job using data gathering method
5- Check the job related information gathered for accuracy and
completeness by verifying the information with a particular job.
6- Write job description and job specification for use in HR activities
then the result is withdrawn and compared with the purpose and of the
job analysis.

Question 6- Explain Recruitment /Search

Definition:-
According to Edwin. B. Flippo, “Recruitment is the process of searching for prospective
employees and stimulating them to apply for jobs in the organization.”

The aim of recruitment is to attract a large number of applications from job seekers. It
makes the requirements of job known to the likely candidate in the job market. It provides
sufficiently large group of qualified candidates so that most eligible employees can be selected.
Thus recruitment is a positive activity which seeks to persuade people to apply for jobs.

The process of recruitment:-

(i) Identifies different source of labour supply.

(ii) Assesses their validity.
(iii) Chooses the most suitable source or sources.
(iv) Invites applications from prospective candidates for vacant jobs.
SOURCES OF RECRUITMENT:-

1) Internal Source (recruitment from within enterprise)

2) External Source (recruitment from outside)
A) INTERNAL SOURCES:-

1) Promotion:-

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Means shifting an employee to a higher position carrying greater pay, status &
responsibilities Various positions in an organisation are usually filled up by promotion of
existing employee on basis of merit or seniority or combination of both.

2) Transfer:-

Refers to change in job assignment which may involve promotion, demotion or no

change in terms of responsibility & status. Transfer may be either temporary or permanent
depending upon necessities of filling jobs. Transfer generally involves no significant change in
pay, status & responsibility of employees.

Advantages:-

1) Employees are motivated to improve their performance.

2) Industrial peace prevails in enterprise because of promotional avenues.

3) It is cheaper source as compared to external source.

4) Transfer of job is a tool of training employees to prepare them for higher job.

5) It promotes loyalty among employees as they feel secured on account of chances of

advancement.

Limitations:-

1) The scope of fresh talent is reduced, when vacancies are filled through internal promotions.

2) The spirit of competition among employees may be hampered.

3) Frequent transfer of employees may reduce overall productivity of organisation.

4) There may be chances of conflict in fighting among employees who aspire for promotion to
available vacancies as those not promoted may become unhappy & there efficiency may decline.

EXTERNAL SOURCES

1) Advertisement:-

Enterprise advertises vacancies through newspaper, trade journals & magazines. The
content of advertisement & media through which advertisement is to be given is decided by
Human Resource department. It is convenient & economical method.

2) Casual Callers:-

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On occasions people drop in without any announcement of vacancy to find out if jobs are
available. A waiting list of such visitors may be prepared & they may be screened to fill the
vacancies whenever they arise.

3) Gate hiring or Recruitment at factory gate:

It is usually followed by factories to fill up vacancies at lower level. Large enterprises

usually play a notice on notice board specifying details of job available. A large number of
unemployed persons assemble at gate where personnel manage scrutinize them & pick the
persons as per requirement Small workshops recruit fitters, welders etc, through this source.

4) Educational Institutions:-

School, colleges & professional institutions offer opportunities for recruiting their
students. Prospective employeers verify credentials of students & conduct interview directly,
placement cells have been set up in well known educational institutions to help students in
securing suitable jobs.

5) Management Consultants:-

Help to recruit technical, professional & managerial personnel for example accountants,
engineers. They specialize in middle level & top level executive placements. They maintain data
bank of persons with different qualifications & skills & even advertise jobs on behalf their
clients to recruit right type of personnel.

6) Recommendations:-

Friends & relative of present employees are also good source of recruitment. Many
concern prefer such candidates as they generally stand surety for new recruits and their
background is partly known & type of preliminary screening take place.

7) Labour Contractor:-

Workers are recruited through labour contractors who are themselves employees of
organisation. The dis advantage of this system is that if contractor leaves the organisation, all the
workers employed through him will also leave. Recruitment through this source has been banned
for public sector units. However, this practice is still common in case of construction industry.

8) Telecasting:-

The practice of telecasting of vacant posts over T.V. (Doordarshan & other channels) is
gaining importance these days. Special programmes like ‘Job Watch’, ‘Youth Pulse’,
‘Employment News’ etc, over T.V. have become quite popular in recruitment for various types
of jobs.

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The use of T.V. as a source of recruitment is less as compared to other sources because it is an
expensive medium.

9) Union list:-

‘Sometimes trade Unions list maintain list of candidates seeking employment in the
concern. Such candidates could be recruited in consultation with union.

10) Central application file:-

A file is maintained of past applicants who were not selected earlier, in case of immediate
requirements such candidates can also be contacted.

Merits:-

1) Wide Options:-

It brings large number of applicants as it permits enterprise to have free hands in making
selection.

2) Fresh talent:-

Enterprise can expect to get fresh talented candidates from outside which leads to
infusion of New Blood & new ideas in to enterprises.

3) Element of competition:-

This is a healthy feature from point of view of enterprise as internal candidates have to
compete with outside candidate.

Limitations:-

1) Lengthy process:-

It takes long time. The business has to notify vacancies & wait for applications to initiate
selection process.

2) Costly process:-

A lot of money has to be spent on advertisement & processing of applications.

3) Uncertain Response:-

The candidates from outside may not be suitable for enterprise. There is no guarantee that
enterprise will be able to attract right kinds of people from external sources.

4) Dissatisfaction among Existing staff:-

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They may feel that their chances of promotion may be reduced.

Question 7 SELECTION

Selection mean a process by which qualified personnel can be chosen from the applicants
who have offered their services to the organisation for employment. Thus, the selection process
is a tool in the hands of the management. Selection involves a series of steps by which candidates
are screened for choosing most suitable persons for vacant posts. It is done by evaluation of
qualification, experience & other information provided by candidates. The object underlying
selection process is eliminated of those judged unqualified to meet job & organisation
requirements. Thus it tends to be a negative process as it reject good proportion of those who
apply.

SELECTION PROCEDURE:-

1) Preliminary Screening:-

a) Receive of application:-

Selection process starts with receipt of application by personnel department.

b) Scruitiny:- All applications received are scrutinized to find out whether candidates fulfill
minimum academic qualification & other requirements.

c) Preliminary Interview:-

It eliminates unqualified candidate

Application Blank:-

If candidate appears to have some chance of being selected, he is given prescribed

application form known as “application Blank.” Application blank is a personal history question
is. Application blank consist of following particulars usually. Indentifying information such as
name, address, age merital status, educational qualification, work experience etc, candidates are
usually ask to fill up the application form in their own hand writing.

3. Employment test:-

Candidates who meet minimum requirements appear written or oral tests as means of
examining suitable for job. The various test include intelligence test aptitude test, trade test,
general personality test, psychological test and proficiency est. depending on job requirements.
These tests are selected and administereal. Some organisation may hold one or more test while

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some other may not hold test at all. Much depends on policy of top management, nature of jobs
and availability of candidates.

4. Selection interview:-

It basically consist of conversation between employer and prospective employee. The

selectors ask for job related and some general questions and see the response of candidates it
helps in avessing candidates strength and a weaknesses. Candidates interact with selector and the
letter gets a first hand idea of personality and other qualities of candidates. Candidates also get a
chance to seek information about enterprise, nature of the job, prospects of promotion.

Ques. 8 Distinguish between training and development. Explain

various techniques of development of managers.
Ans. Training is a process of learning a sequence of programmed behavior. It is application of
knowledge. It gives people an awareness of the rules and procedures to guide their behavior. It
attempts to improve their performance on the currents job or prepare them for an intended job.

Development is a related process. It covers not only those activities, which improve job
performance, but also those which bring about growth of the personality; help individuals in the
progress towards maturity and actualization of their potential capacities so that they become not
only good employees but better men and woman. In organisational terms, it is intended to equip
persons to earn promotion and hold greater responsibility. Training a person for higher and
bigger job is development. And this may well include not only imparting specific skills and
knowledge but also inculating certain personality and mental attitudes.

Training is short term process utilizing a systematic and organised procedure by which
non managerial personal learn technical knowledge and skills for a definite purpose.
Development is a long term educational process utilizing a systematic and organised procedure
by which managerial personnel learn conceptual and theoretical knowledge for general purpose.

Management development is any attempt to improve managerial performance by

imparting knowledge, changing attitude or increasing skills. The general management
development consists of (1) assessing the company’s strategic needs (for instance, to full future
executive openings or to boost competitiveness).

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(2) Developing managers for future responsibilities.

There is more emphasis on choosing management development methods that are more
organisationally relevant and effective that they have been in the past. Various techniques of
management development include:-

(a) Management on-the-job training.

(b) Off the job training.
(c) Managerial on-the-job training methods include job-rotation, coaching/understudy
approach and action learning.
Job rotation means moving management trainees from department to broaden their
understanding of all part of the business and to test their babilities. A manager may spend several
months in each department. The person may just bean observer in each department but more
commonly gets fully involved in its operations.

Coaching/understudy approach: Here the person workers directly with the senior manager or
with the person he or she is to replace; the latter is responsible for the executive of certain
responsibilities, giving the trainee a chance to learn the job.

Action learning programmers give managers and others released time to work full time on
projects, analysis and solving problems in departments other than their own trainees meet
periodically in four or five person project groups to discuss their findings. Several trainees may
work together as a project group or compare notes and discuss each other’s projects.

Off the job training and development techniques

The off the job development techniques for managers include case study method; management
games; role playing etc.

Case Study method:- Case study method presents a trainee with a written description of an
organisational problem. The person then analyzes the case, diagnoses the problem and presents
his or her findings and solutions in discussion with other trainees.

Management Games:- With management games trainees are dividend in to give or six persons
group, each of which competes with the others in a stimulated marketplace. Management games
can be good development tools. People learn best by getting involved, and the games can be
useful for gaining such involvement. They help trainee develop their problem solving skills, as
well as to focus attention on planning rather than just putting out fires. The group also usually
elect their own officers and organize themselves; they can thus develop leadership skills and
faster cooperation and team work.

Roll Playing:- The aim of role playing is to create a realistic situation and then have the trainees
assume the role of specific persons in that situation. When combined with the general instruction

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and other roles for the exercise, role playing can trigger spirited discussions among the role
player trainees. The aim is to develop trainee’s skills in areas like leadership and delegation.

Question- 9 what performance management is and what are

the methods of performance appraisal?
It is the integrated process that consolidates goal setting , employee
development performance appraisal and rewarding performance nto a
single common system. Performance management practices through which
managers work with their employees to define the goals of company and
develop employee capabilities through training measure and review
employees performance in order to reward performance.
There is some difference between performance appraisal and performance
management performance appraisal represents an isolated mechanistic and
hr driven approach while performance management is a comprehensive
integrated business driven system aimed at organizational and people
development.
Objective of performance management system
1 Human resource planning-
Performance appraisal information provides valuable input for skill
inventories and human resource planning providing information about the
human resource strength and weakness and this system helps determine
the promotability and potential of all employees.
2- Recruitment and selection- performance appraisals can be used to
validate or evaluate decision related to employee recruitment and selection
it is possible to determine the effectiveness of recruitment and selection
system.
3- Personnel decisions- performance data helps make rational personnel
decisions. In the absence of information decisions become subjective.
4-Training and development- performance appraisal helps an
organization determine specific training and development needs based on
an assessment of deficiencies in performance levels and skills.
Performance appraisal should clearly determine whether the reasons for
performance deficiency are due to the lack of skills or because of low
morale. They also help in the development of action plans for individual
performance improvement and facilitate learning of new behavior;
performance feedback is a primary developmental need and serves to
motivate employees. Performance appraisals help determine employee
strengths, weaknesses, potentials and training need.

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5- Career planning and development – performance appraisal also helps in

identifying employee potential and in planning future growth opportunities for
the employee. Information about the strengths weaknesses and potential of
employees can be used to counsel and assist them in developing and
implementing realistic career plans.
6- Compensation and reward – for a fair reward policy performance appraisal
should be there otherwise every employee will have same salary and same
bonus so for distributing rewards according to their performance appraisal
system is being done.
Problems in performance management
Ambivalence The manager is responsible for the performance of his
subordinates. He must ensure that employees’ performance contributes to the
achievements of the organizational goals and targets. So it the part of manager
job to appraise subordinate performance provides feedback and make decision
about the salary and promotion on basis of performance. Problem arises when
subordinate performance is unsatisfactory and there may be negative
motivation and nobody wants to be demoted. The subordinates are ambivalent
all employees would like to get an objective feedback about their performance
so that they can improve their performance and when performance feedback is
negative employees find it difficult to accept it it leads to a sense of failure
and lowering of self esteem

System design and implementation problem

Problems in conducting performance appraisal can be traced to poorly
specified performance criteria us of inappropriate performance appraisal
approaches, poorly constructed performance appraisal methods or lack of top
management support to the process. A performance evaluation system may
focus only on personality traits and this may result in dissatisfaction because
when this performance appraisal data is used actual job performance gets
ignored.
Rater biases and errors
Even the most well designed system can fail if the people using the system
are not well trained in it use. They may deliberately distort appraisal or hold
negative attitude about the performance appraisal process.
How to make effective performance management system
Separate evaluation and development appraisal- there should be two
separate formal performance appraisal in a year one that focuses on evaluation
and the other that focuses on development. Decisions about pay increase
rewards and promotions should be scheduled at a different time of the year
rather than in the meeting that engages the subordinate in a dialogue for

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identifying performance problems and developing plans for performance

improvement.
Use job related performance criteria
To ensure that the criteria used in appraising performance is job related it
should be determined through job analysis. Even subjective criteria such as
loyalty initiative should be used only when they can be clearly shown to be
related to the job.
Specifying performance standards- it is important to specify performance
standards for each criteria of performance. These performance standards or
expectations must be mutually agreed upon by the managers and subordinates
before the beginning of the appraisal period.
Use appropriate performance data- Appraisal that use behavioral data result
in greater acceptance on the part of the subordinate of his performance
evaluation. There should be proper feed back from the employees and this
feedback will help the subordinates in improving their performance.
Improving superior and subordinate relation-
The result and quality of appraisal process depends on the ongoing supervisor
subordinate relationship. If the relationship is good the supervisor will provide
feedback and coaching to the subordinates on an informal ongoing basis.
Provide ongoing feedback-
All employees like to know how well they are performing their jobs.
Principles of learning suggest that immediate feedback is more effective than
delayed feedback. When delayed the subordinate may not be able to associate
the feedback with a specific behavior. Ongoing feedback is inherent to the
MBO approach.
Upward appraisals
The superior has authority and controls rewards such as promotions. This
results in submissive on the part of the subordinate in order to gain rewards. In
order to manage unequal power distribution between the manager and their
subordinates’ upward appraisal should be applied in organization

Question 10 Compensation

“ Compensation refers to a wide range of financial and non-financial rewards to employees for
their services rendered to the organisation.” It is paid in form of wages, salaries, and employee
benefits such as paid vacations, insurance, maternity leave, free travel facility, retirement
benefits etc. monetary payments are a direct form of compensating employees & have a great
impact in motivating employees. The system of compensation should be designed in such a way
that it achieves following objectives:

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(1) Capable employees are attracted towards organisation.

(2) Employees are motivated for better performance.
(3) Employees do not leave employer frequently.
Base compensation: Wages and Salary

Base compensation includes monetary benefits to employees in form of wages or salaries. The
term ’wage’ is used to denote remuneration to workers doing manual or physical work. Thus
wages are given to compensate the unskilled workers for their services rendered to organisation.
Wages may be based on hourly, daily, weekly or even monthly basis.

The term ‘salary’ means compensation to office employees, foremen, managers &
professional & technical staff. It is based on weekly, monthly &yearly basis. Thus time period
for which salaries are paid is generally higher than in case of wage payments.

Wages may be based on number of units produced (i.e. piece wage system) or time spent
on job. But salary is always based on time spent on job.

Factors determining pay rates:

1) Demand and supply:- Wage rates of workers depends upon demand and supply force in
labour market. If the labour is in short supply, the workers will offer the services only if they are
paid well. On the other hand, if the supply is more then workers available might get ready work
at cheaper rates.

2) Bargaining Power: Where labour unions are strong enough to force the hand of employers,
the wages will be determined at a higher level in comparision to other units where unions are
weak.

3) Cost of living:- Wages of workers also depends upon the cost of living of the worker so as to
ensure him a decent living wage. Cost of living varies under deflationary and inflationary
pressures. Where labour uncons are strong and employer do not show enough awareness, here
wage are adjusted according to cost of living index numbers.

4) Condition of product market:- Degree of competitions prevailing in the market for the
product of the industry will also influence the wage level. For eg if there is perfect compition in
the market the wage level may be at par with the value of net additions made by the workers to
the total output, but may not reach this level in case of imperfect compition in the market.

5) Comparative Wages:- Wages paid by the other firms for the same work also influence the
wage levels. Wage rates must also be in consistent with the wages paid by the other firms in the
same industry so as to increases the job satisfaction among the workers.

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6) Ability to Pay:- Wage rates are influenced by the paying ability of industry or firms to its
workers. Those firms which are earning huge profits may afford to pay high wages and can
provide more facilities to its workers in comparison to the firms earning comparatively low
profits.

(7) Productivity of labour:- Fligher productivity will automatically fetch more profit to the
firm, where in turn workers will be paid high wages in comparison to other firms with low
productivity.

(8) Job Requirements:- If a job require higher skill, greater responsibility and risk, the worker
placed on that job will naturally get higher wages in comparison to other jobs which do not
require the same degree of skill, responsibility or risk.

(9) Govt. Policy:- Since the bargaining power of the workers is not enough to ensure fair wages
in all industries, the Govt. has to interfere in regulating wage rate to guarantee minimum wage
rates in order to cover the essentials of a decent living.

(10) Goodwill of the company:- A few employers want to establish themselves as good
employer in the society and fix higher wages for their workers. It attract qualified employees.

In addition there are other important factors which affect the individual differences in wage rates.
These are:

1). Worker’s Capacity and Age

2). Educational qualification.

3). Work experience.

4). Promotion possibilities.

5). Stability of employment

6). Demand for product.

7). Profits earned by the organisation.

8). Hazards involved in work etc.

Affecting, determining and establishing pay rates.

Ans. Compensation may be defined as money received in the performance of work, plus the
many kinds of benefits and services than organisations provide their employees. Money is

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included under direct compensations (popularly known as wages i.e. gross pay): while benefits
come under indirect compensation and may consist of life, accident and health insurance and
employer’s contribution to retirement, pay for vacation or illness and employer’s required
payments for employees welfare as social security.

Factor affective pay rates include:-

a) The organisation’s ability to pay

b) Supply and demand of labour
c) The prevailing market rates
d) The cost of living
e) Living wage
f) Productivity
g) Trade union Bargaining power
h) Job requirements
i) Management attitudes

Higher wages are given by those organisation which can afford them. Companies that have
good sales and therefore, high profits tend to pay higher wages than those which are running at
loss or earning low profits because of high cost of production or low sales.

The labour market condition or supply and element forces operate at the national, regional
and local levels and determine wage structure and level. If the demand for certain skills is high
and the supply is low, the result is a rise in the price to be paid for these skills.

Most of the companies adopt prevailing market safe or going wage safe criterion for
compensating its employees. This is done for several reasons. First, competition demands that
competitors adhere to same relative wage rate. Second, various government laws and judicial
decisions make the adoption of uniform wage rate an attractive proposition. Third, trade unions
encourage this practice so that their members can have equal pay for equal work. Fourth,
functionally related firms in the same industry require essentially the same quality of employees,
with the same skills and experience. This result in a considerably uniformity in wages and salary
rates, finally if the same or about the same general rates of wages are not paid to the employees
as are paid by the organisational competitors, it will not be able to attract and maintain a
sufficient quantity and quality of manpower.

The cost of living pay criterion is usually regarded as an automatic minimum equity pay
criterion. This criterion calls for pay adjustments based on increases or decreases in an
acceptable cost living index.

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The living wage criterion means that wages paid should be adequate to enable an employee
to maintain himself and his family at a reasonable level of existence.

Trade unions do effect rate of wages. Generally, the stronger and more powerful the trade
union; the higher the wages. A trade unions bargaining power is often measured in terms of its
membership, its financial strength and the nature of its leadership.

Generally, the more difficult a job, the higher are the wages. Measures of job difficulty are
frequently used when the relative value of one job to another in an organisation is to be as
curtained. Job are graded according to the relative skill, effort, responsibility and job conditions
required.

Managerial attitudes have decisive influence on the wage structure and wage level since
judgment is exercised in many areas of wage and salary administration including whether the
firm should pay below average or above average rates, what job factors should be used to reflect
job worth, the weight to be given below the structure and level of wages are bound to be affected
accordingly. These matters require the approval of top executives.

Various factors for establishing pay rates include:-

1. These should be definite plan to ensure that differences in pay for jobs are based upon
variations in job requirements. Such as skill, effort, responsibility or job or working
conditions and mental and physical requirements.
2. The general level of wages and salaries should be reasonably in line with that
prevailing in labour market.
3. The plan should carefully distinguish between jobs and employee. A job carries a A
certain wage rate and a person is assigned to fill it at that rate. Exceptions sometimes
occur in very high level jobs in which the job holder may make the job large or small,
depending upon his ability and contributions.
4. Equal pay for equal work i.e. if two jobs have equal difficulty requirements, the Pay
should be the same, regardless of who bills them.
5. An equitable practice should be adopted for the recognisation of individual
differences in ability and contribution. For some units this may take the form of rate
ranges, with in grade increases; in other this may take form of closely integrated
sequences of job promotion.
6. The should be a clearly established procedures for hearing and adjusting with the
regular grievance procedure if it exits.
7. The employees should be informed about the procedures used to establish wage rates.
Every employee should be informed of his position and of the wage and salary
structure. Secrecy in wage matters should not be used as a cover up for haphazard and
unreasonable wage programme.

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1. The wage should be sufficient to ensure for the worker and his family reasonable
Standard of living. Workers should receive a guaranteed minimum wage to protect
them against conditions beyond their contract.
2. The wage and salary structure should be flexible so that changing conditions can Be
easily met.
3. The wage and salary payments must fulfill a wide variety of human needs, Including
the need for self actualization. It has been recognized that money is the only form of
incentive which is wholly negotiable, appealing to widest range of seekers. Monetary
payments of ten out as motivators and satisfiers interdependently of other job factors.

Question 11- write note on career planning,

development and career management.
Career planning involves establishment of individual career objectives
based on an assessment of career goals, aspirations, performance and
potential. Career planning is concerned with the choosing of occupation
organization and jobs by individuals. It is a personalized and ongoing process
whereby an individual establishes career goals and identifies the means for
achieving these goals. Career planning should focus on matching personal
goals with opportunities that are realistically available. Since the number of
positions at senior level are scarce, upward mobility cannot be a reality to
everyone. Career planning need not focus only on success related to
promotions.
Career development- refers to the activities and processes undertaken by the
organization to help employees attain their career objectives. It is the process
by which an individual’s career plans are accomplished. Career development
focuses on improving work effectiveness and performance in the immediate or
intermediate time frames. Career development is oriented towards long term
career effectiveness and success of the employees.
Career management is a continues process that involves setting personal
career goals developing strategies for achieving these goals and revising the
goals based on work and personal experiences. Career management is an
ongoing process of preparing implementing and monitoring career plans
undertaken by the individual alone in concert with the organization.
Organizational career management is the design and implementation of
activities relevant to the career development of its employees.

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Question 12 describe career planning and development

Career Planning & development is a holistic approach for objective description of the career
progression path for all levels of employees in an organisation. Main two concepts are used with
different in same organisations in same organisation like, career planning for non-executive &
managerial level for our purpose we have considered both the terms more in two general, rather
than specific sense.

Definition:-
Career Planning is a sequence of attitudes and behaviour associated with the
series of job & work related activities over a person’s life time. Career Planning evaluate one’s
abilities and interests, considering alternative career opportunities, establishing career goals and
planning practical development activities.

Career Development::- means the process of increasing an employee’s potential for

advancement and career change.

Career Planning is very important for an organisation.

 Proper Sequence:- It is a proper sequence of job related activities such job related
activities vis-à-vis experience include sale experience at different hierarchical level of an
individual, which lead to an increasing level of responsibilities, status power,
achievement & rewards.
 It may be include centered or Organisational-centered:- Individual centered career is
an individually perceived sequence of career progression within an occupation.
For example-In medical profession, we have clearly defined stages of education, intership,
residency etc.

Similarly in college teaching we have stages like lectureship, readership and professorship.

 Integrated Pace:- It is better defined as an integrated pace of lateral management in an

occupation of an individual over his employment span.
 Progression:- Progression is very precious step in career planning because in progression
include improvement and development only step by step in logical form.
 Improvement:- In career planning improvement in morale, motivation, skills, knowledge
and ability.
Important factors and steps in career planning
Factors:-
- It is a continuous process.
- It resources in organisation should also to be communicated to the employees from time
to time.
- It is a dynamic process.

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- It increases in personal skills.

- It increases to updating knowledge activity.
- In increases in improving performance.
Steps/ Process in Career Planning
Career Planning involves different activities for successful organisation cover important
following steps:-

- Preparing Personal Skills Inventories:- The first step is to prepare personal skills
inventories, which contains data or employee’s skill and career goals. In addition there
are required data banks, which provide the following information.
a. The organisation structure and the persons managing different positions in the
organisation their age, education, experience, goals, authority and responsibility.
b. The performance record and ratings, interpersonal abilities of the employees.
c. Their preferred location, designs and constraints.
d. Future impression of manpower for expansion or diversification of the company
or for natural
e. wastages like death, disability, retirement, discharge and dismissal, resignation
etc.
In most of the organizations such information is computerized periodically revise and
updated. After preparation of personal skills inventories & additional data, it is
necessary to develop career path for employees.

2. Developing Career Paths:- Career Paths are logical mapping out of jobs, which represent a
potential progression that an employee may follow over time. Such mapping of job progression
are done in the firm of career ladders by clubbing together similar lives of occupations in job
families. Job families are group of homogeneous jobs i.e. jobs with similar characters.

For example- Model of career paths for HR Manager

General Manager

HR Executive
HR Executive

Trainee
Trainee
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Executives R & S / T & D

- Put the Right Man at the Right Place:- The third step in career planning process is to
identify suitable employees who have the ability, potential, willingness to take up higher
responsibilities and rise-up the organisation ladder for this most of the organizations have
performance appraisal and merit rating system. This system enables organizations to
compare the performance measures of different individual in terms of job requirement
and helps in identifying training requirement, selecting for promotions providing
financial rewards etc.
Two main steps:-
f. Impart Training
g. Review & Counseling

Conclusion:- Career Planning & development is a holistic approach for objective description of
the career progression path for all

Question 13 .What is career development? Why is it important for

an organisation? Explain cycle/ stages of career development
process.

Ans. Definition:- Career Development means the process of increasing an employee’s potential
for advancement and career change. It is a systematic process of guiding the movement of human
resource of an enterprise through different hierarchical positions.

Importance of Career Development

Career Development is very important for organisations:-

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(a) Changing environment is now making jobs more complex. A suitable career
development programme enables employees to be better prepared for future position
in the organisation.
(b) Career development programme enables the organisation to receive maximum
contribution from employees. Since this helps employees to enhance their skills for
higher positions
Both under utilization of employer’s potential work energy and then underemployment
can be avoided.

(c) Career development makes employees more adaptable to changing requirements of

the organizations. The requirements may either change due to new technology
computer, numerically controlled technology etc.
(d) It provides an objective basis to describe the steps of progression in a given
organisation and therefore, minimize unfair promotion practices of employees
reducing the chance of promotion by discretion.
(e) Women & other minority classes of employees now also manage most of the
organisations. A career development programme ensures equitable opportunity for
career progression of these classes of employees also. Thus it meets the requirements
of equal employment opportunities for all.
(f) A career development programme gives opportunities to employees to acquire more
skills, obtained desired jobs, share increased responsibilities, enjoy scope of job
mobility & derive increased job satisfaction.
Stages of Career Development Process
(1) Exploratory Stage:- The stage starts when a new employee joins an organisation. An
employee with his qualification and knowledge joins an organization and find himself in an
apparent mis-match condition which cannot be set right with the indication programme to the
organisation.

It is essential for the organisation to sustain the behaviour as well as

operational deficiencies to help him to develop in the course of time.

(2) Establishment Stage:- After a new entrant chooses his career from different given
alternatives, he needs to be provided with regular feedback on his performance. Such
performance feedback enables the new employees to understand the effectiveness of his
performance and at the same time he can also initiate required corrective action to overcome his
functional deficiencies.

A successful career development process at establishment stage, therefore is important to retain

employees in the organisation and at the same time to develop a sense of loyalty and
commitment to the organisation.

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(3) Maintenance Stage:- This is a mid career stage for employees who strive hard to retain
their establishment name & fame. At this stage employees need to put their continuous efforts for
self-development. This stage is crucial and unless the organization adopts suitable career
development Programme it may face high employee turnover.

(4) Stage of Decline:- Employees at this stage being prepared for retirement, get scared from the
possible threat of reduced role of responsibilities in the organization. Career development
process at this stage. Therefore, should aim at helping the employees to get mentally prepared for
retirement rituals, particularly to prepare them to accept a reduced role & responsibilities, so that
they can accommodate with their family and the society in the later part of their life

Question 14- what is mentoring and outcomes of

mentoring and barriers of mentoring.
Mentoring refers to the information and advice provided by an older
experienced individual to a younger and less experienced individual to help in
latter’s growth and development. Mentoring is about support development and
problem solving through experience sharing. It works best when the mentor is
not the direct supervisor nor from the same department
Outcomes of the mentoring
Job performance- new employees who have a mentor perform better on the
job and may be more successful in their careers.

Socialization Individuals who have a mentor during the early period of their career are likely to
understand and adapt better to the intricacies of the work environment and the culture of the
organization, stay with the organization much longer and find a better fit with the organization.

Human resource and succession planning - Mentoring helps to groom high potential
individuals for succession into senior jobs and advancing them through the organizational
structure

Leadership development Those employees who serve as mentor get an opportunity to practice
leadership behavior and develop relevant skills.

Cultural diversity- mentoring programmes help support and promote cultural diversity within
the organization.

Political sponsorship Those who have a mentor find it easier to navigate through the unknown
realms of a new organization.

Barriers to mentoring

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Contextual problem - these problems arise due to organizational barriers and relate to issue of
clarity of purpose or to the degree of support provided by the organization for the programme
and the mentor mentees relationship.

Interpersonal problems- the reactions of people who are not included in the mentor mentees
relationship may result in interpersonal problems with mentoring programmes. Like direct
supervisor may feel threatened by the proximity of the protégé to a senior manager line manager
should be included in the overall design and management of the programme.

Procedural problems- these problems relate to the manner in which the implementation of the
programme is managed the mentor and protégé may be given very specific instructions about the
content of discussion in their scheduled meeting mentor may become overly directive

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