Chapter 1

Introduction to Human
Resource Management
Reference Books:
Human Resource Management ( Gary Dessler)
Human Resource Management (Mondy)
Human Resources and Personnel Management ( Keith Davis)
 Internet

Resource Person: Furqan-ul-haq Siddiqui

 The Management
PHYSICAL
HUMAN Planning
RESOURCES RESOURC
ES
g l lin
ro
nt

ORGANIZATIONAL

g
Co

in
GOALS

iz
an
rg
O
INFORMATION Leading FINANCIA
RESOURCES L
RESOURC
ES
 Management in Organizations

Planning
and decision Organizing
making
Inputs from the environment
• Human resources Goals attained
• Financial resources • Efficiently
• Physical resources • Effectively
• Information resources

Controlling Leading
 HRM
Human

Resource

Management
 Human Resource Management
Managerial function that
tries to match an
organization’s needs to the
skills and abilities of its ssible,
s p o ”.
employees. hing pp en
ke t h a
m a s in g
s et s e th
“As le mak
peo p
 Human Resource Management
 Human Resource Management (HRM) is the
approach of Management of an organization's most
valued assets - the people working there who
individually and collectively contribute to the
achievement of the objectives of the business. In
simple sense, HRM means employing people,
developing their resources, utilizing, maintaining
and compensating their services in tune with the job
and organizational requirements to achieve its goals
effectively & efficiently.
Organizational Performance

 Efficiency: A measure of how well

resources are used to achieve a goal
“Doing Things Right”

 Effectiveness: A measure of the

appropriateness of the goals chosen (are
these the right goals?), and the degree to
which they are achieved
“Doing the Right Things Right”
Efficiency versus Effectiveness

Efficiency: Effectiveness:
Operating in Doing the right
such a way Successful things in the
that resources right way at
Management
are not wasted the right times
 Functions of HRM
 Determining the nature, functions of each employee’s job
 Planning HR needs and recruiting job candidates
 Selecting job candidates
 Orienting and training new employees
 Managing wages and salaries (compensating employees)
 Providing incentives and benefits
 Appraising performance
 Communicating (interviewing, counseling, disciplining)
 Training and developing managers
 Building employee commitment
 Staffing

Employee
Human
& Labor HUMAN RESOURCE Resource
Relations MANAGEMENT
Development
FUNCTIONS

Safety & Compensation

Health & Benefits
 Why Is HRM Important to All Managers?
Some Common Consequences Caused by
Poor HRM Practices
 Hire the wrong person for the job
 Experience high turnover/dissatisfaction
 Have your people not doing their best
 Employees will not know that what to do & how to do
 Have your company in court because of
discriminatory/unlawful actions
 Have some employees think their salaries are unfair and
inequitable internally & externally
 Allow a lack of training to undermine your department’s
effectiveness
 Commit any unfair labor practices
 Functions of HRM

1.Staffing

5.Employee 2.Human
& Labor Resource
Relations Functions Development
of HRM

4.Safety & 3.Compensation

Health & Benefits
 1.Staffing
 Process through which an organization ensures that
it always has the proper number of employees with
the appropriate skills in the right jobs at the right
time to achieve the organization’s objectives.
 It includes
• Personnel planning
• Job Analysis
• Recruitment
• Selection
 2.Human Resource Development
 Major Personnel function that consist not only of
T&D but also individual career planning,
developing activities and performance appraisal.
 HRD is composed of
• Training
• Development
• Career planning
• Career Development
• Performance Appraisal
 3.Compensation & Benefits
 Consist of all direct, indirect, financial & non
financial rewards given to employees in return of
their services.
• Pay - Money that a person receives for performing a
job
• Benefits – Additional Financial rewards in addition
to base pay including paid vocations, sick leave,
insurance etc.
• Non financial Rewards
 The Job
 The Environment
 4. Safety & Health
 Safety involves protecting employees from injuries
caused by work related accidents. Health refers to
employee’s freedom from physical or emotional
illness.
5. Employee & Labor Relation
 Deals with employee employer relationship &
dealing with labor unions
Successful HRM
Good for…
Organization
Employee
Society
 HR as
Competitive Advantage Competitive Advantage

 Competitive  There is greater

advantage means
“any factors that allow
an organization to
differentiate its
product or service
from those of its
competitors to
increase market
share”
recognition that
distinctive
competencies are
obtained through highly
developed employee
skills, distinctive
organizational cultures,
management
processes, and
systems.
Effective
Effective Effective
Effective
HRM
HRM Organization
Organization
 Managing Human Resources
 Purpose of HRM is;
To attract
 To Develop
 To Motivate and
 To Keep talented people
To achieve goals
Challenges?
 Environment (Challenges) of HRM
EXTERNAL ENVIRONMENT Labor Force
Legal consideration
INTERNAL ENVIRONMENT
The Economy

Mkt OPS

Society
Employee Human
Staffing
& Labor Resource
Relations Development

Budget downsizing
HR Management

Brain drain
technology

Functions Compensation
Safety
& Benefits
& Health
Fin. Turn over OFA

Customer Competition Share holder Unions

 The External Environment
Components
 Labor Force  Competition
 legislation  Customers
 Society ( Social  Technology
Responsibility)  Economy
 Unions  Brain-drain
 Stakeholders  Rapid change

Open System- An open system is one that is effected by environments

Firm has little control over external factors
 Legislation
• The Government regulation related to
HR & labor force
• Employment laws
 Laws and Regulations
• for safety
• Minimum wage rate
• EEO
• Working hours
• Immigrants
• Child Labor
• Women
 Pakistan
 Pakistan's first minimum wage was implemented in
1992 and does not apply to agricultural workers and
Newspapers.
 The first minimum wage was 1,500PKR (~US$
24.60) per month.
 It was raised in 1996 to 1,650PKR (~US$ 27.10),
in 1998 to 1,950PKR (US$ 32)
in 2006 to 4000PKR(US$ $66)
and is currently, as of 2008, at 6000PKR per month.
 International Dimension/ Globalization
 The extent to which an
organization is involved in
or affected by business with
other countries.
 The internationalization of
products and services of a
firm heavily influence
organizational HR decisions.
 Economic Environment
 The overall strength & vitality of the economic
system in which organization operates. Factors that
affect buying power and spending patterns of
organization & its customers/suppliers.
 Trends of interest:
 Inflation
 Interest Rates
 Employment ratios
 Per Capital Income
 Purchasing power of customers
 Stage of Business/Economic Cycle (prosperity, recession,
depression and recovery)
 •Labor Force- it’s the pool of individuals who are
willing to work for a company.

This map
shows the global
distribution of labor
force in 2006 as
a percentage of
the top market
(China - 795,300,000).
 The Internal Environment
 Limited budgets
 Trends of Downsizing
 Workforce Diversity
 High Turn over- is the rate at which an employer gains
and loses employees or the rate of traffic through the
revolving door."
 Restructuring-the act of reorganizing the legal,
ownership, operational, or other structures of a company for
the purpose of making it more profitable, or better
organized for its present needs.
 Internal Unions
 Proactive Versus Reactive

 Reactive Response: Action taken in

response to change
 Proactive Response: Action taken in
anticipation of change