1. Concept of HRM
HRM = managing people of an organisation with a human approach (“management of man”).
Binds people + organisation together so both their goals are achieved.
A management function: recruiting → selecting → training → developing human resources.
Covers the “people dimension” of management — not material or financial resources.
Key definitions (remember author + keyword):
| Author | Keyword to remember |
|---|---|
| Leon C. Megginson | HR = knowledge, skills, creative abilities, talents, aptitudes (national + enterprise view) |
| Michael Armstrong | “Strategic and coherent approach” to most valued assets (people) |
| Edwin B. Flippo | Planning, organizing, directing, controlling of P-D-C-I-M-S* |
| Indian Institute of Personnel Management (IIPM) | Responsibility of all who manage people; “people at work + their relationships” |
*Flippo’s functions = Procurement, Development, Compensation, Integration, Maintenance, Separation.
Clinical analogy: HRM is the physiology of an organisation — the body has organs (departments), but HRM keeps the people (cells) healthy, coordinated, and performing.
2. Characteristics of HRM (6)
Universal force & integral part — present in all organisations, every level; tied to strategic decisions (Dessler: getting results through people is “the name of the game”).
People-Oriented — manages human, not material/financial, resources; best fit between individuals.
Staff Function — supportive/service function; assists line managers (hire, train, reward, counsel). “Service to line management is the bread and butter.”
Comprehensive function — covers all people, all levels (workers → managers; skilled, technical, clerical, etc.).
Line Responsibility — HR manager also exerts line authority within his own HR department.
Pervasive Responsibility — all-pervasive; every manager does HR through people.
Memory hook: “U-P-S-C-L-P” → Universal, People, Staff, Comprehensive, Line, Pervasive.
3. Scope of HRM
IIPM’s 3 core aspects:
| Aspect | Covers |
|---|---|
| Personnel Aspect | Manpower planning, recruitment, selection, placement, transfer, promotion, training & development, layoffs/retrenchment, remuneration, incentives, productivity |
| Welfare Aspect | Working conditions & amenities — canteen, crèche, rest/lunch room, medical assistance, education, health, safety, recreation |
| Industrial Relations | Union–management relations, joint consultation, collective bargaining, grievance & disciplinary systems, settlement of disputes |
Added over the years: HR Planning · Employee Assistance · HR Information System (HRIS) · Organizational Development (the “synergetic effect”) · Selection & Staffing · Employee Training & Development.
4. Objectives of HRM (10)
Goal = attain organisational goals economically + effectively while promoting employee welfare.
Procurement of personnel (get capable people).
Effective utilisation of human resources.
Build desirable working relationships.
Raise morale of employees.
Cost containment.
Integration of goals (individual/group ↔︎ organisation).
Maximum individual development.
Satisfy individual needs & group goals (fair remuneration, security).
Healthy employer–employee relations (“minimum cost, maximum profit”).
Disciplined atmosphere at work.
5. Importance of HRM — 4 Levels
| Level | Why it matters |
|---|---|
| Enterprise | Attract/retain talent, develop skills & attitudes, secure cooperation, utilise HR, ensure future competent team |
| Professional | Improves quality of work life, teamwork, personal development, healthy relationships, proper work allocation |
| Social | Enhances dignity of labour, suitable employment, balances jobs ↔︎ jobseekers, conserves physical/mental health |
| National | Skilled committed manpower drives economic growth → higher living standards & fuller employment |
Trading analogy: Human capital is the compounding asset — two firms with identical resources diverge in returns purely on quality of people (like two traders with the same capital but different skill).
6. Functions of HRM
Two broad classes: Managerial + Operative.
A. Managerial Functions (P-O-D-C)
Planning — predetermined course of action; forecast HR needs, labour-market & wage trends; bridges “where we are → where we want to go.”
Organizing — allocate tasks, set authority–responsibility, integrate activities; the structure that is the foundation of effective management.
Directing — motivating, activating, leading, supervising; the “heart” of management (initiates action).
Controlling — checking, verifying, regulating; audit training, analyse labour turnover, morale surveys, separation interviews.
B. Operative Functions (5)
| Function | Activities |
|---|---|
| 1. Procurement | Job Analysis → HR Planning → Recruitment → Selection → Placement → Induction/Orientation |
| 2. Development | Performance & Potential Appraisal, Training, Executive Development, Career Planning & Development |
| 3. Compensation | Job Evaluation, Wage & Salary Administration, Bonus (Payment of Bonus Act, 1965) |
| 4. Integration | Reconcile org ↔︎ member goals: motivation, job satisfaction, grievance handling, collective bargaining, workers’ participation, counselling, QWL |
| 5. Maintenance | Protect physical/mental health: fringe benefits (housing, medical, conveyance), social security (PF, pension, gratuity, maternity, insurance), safety + records/research |
Watch the difference (common trap):
Recruitment = searching & attracting applicants (positive process).
Selection = judging suitability & choosing the best (negative/screening process).
Job Analysis → output = Job Description + Job Specification.
7. Role of HRM (8 roles)
Specialist — advises functional heads on planning, recruitment, training, appraisal, compensation.
Humanitarian — moral & ethical obligations to employees.
Counsellor — marital, health, mental, physical, career problems.
Mediator — peacemaker in disputes/conflicts.
Spokesman — represents company in media/forums.
Problem Solver — overall HRM & long-term planning.
Change Agent — introduces institutional change & OD programs.
Management of Manpower Resources — leadership + labour-management relations.
8. Origin, Evolution & Development of HRM
Seeds in Industrial Revolution (1850s), Western Europe & USA → reached India early 20th century.
| Era | Key person / event | Core idea |
|---|---|---|
| 1. Trade Union Movement | Royal Commission of Labour India 1911 (Whitley); Trade Union Act 1926 | Abolish ‘jobber’ system; protect workers → birth of collective bargaining, grievance handling, arbitration |
| 2. Social Responsibility | Robert Owen (British industrialist) | Paternalistic — owner = father, worker = child; shower baths, model villages, ↑ min wage, ↓ hours 12→10 |
| 3. Scientific Management | F.W. Taylor | 4 principles: scientific work methods, scientific selection/training, division of work, harmony & cooperation |
| 4. Human Relations | Hugo Munsterberg; Elton Mayo — Hawthorne Experiments (1924–32) | A happy worker is a productive worker; social/psychological needs > physical environment |
| 5. Behavioural Science | Sociology/psychology/anthropology scholars | Human behaviour = means to efficiency; motivation, leadership, group dynamics; people enjoy work |
| 6. Contingency Approach | Mary Parker Follett (“Law of the Situation”), Taylor, Fayol | No single best way — match management to the situation |
| 7. Systems Approach | — | Org = interdependent sub-systems (Technical, Social, Power); inputs→transform→outputs→feedback; MIS at core |
Hawthorne findings (high-yield, 5):
Physical environment had no material impact on efficiency.
Favourable worker/team attitudes mattered more.
Meeting social & psychological needs ↑ morale & efficiency.
Informal groups strongly influenced performance.
Money alone doesn’t motivate — security, recognition, voice do.
Clinical analogy (Human Relations Era): Like the placebo effect — the psychosocial context (attention, being observed/cared for) changed outcomes more than the physical intervention itself. That’s literally what Hawthorne showed.
High-Yield Exam Anchors
IIPM appears twice: scope (3 aspects) + definition.
Flippo’s 6 functions (P-D-C-I-M-S) — easy MCQ.
Managerial = P-O-D-C; Operative = 5 functions.
Dates: Trade Union Act 1926, Payment of Bonus Act 1965, Hawthorne 1924–32, Royal Commission 1911.
Robert Owen → paternalism; Taylor → scientific (4 principles); Mayo → Hawthorne/Human Relations; Follett → Law of the Situation (contingency).