MBA Sem 1

Paper-HRM(MB106)
Topic-Nature and
scope of HRM
Date-27 April 2021
Faculty-Pushpanjali
Singh
According to the Invancevich and Glueck, “HRM is concerned with the most effective use of people
to achieve organizational and individual goals. It is the way of managing people at work, so that they give
their best to the organization”.
According to Dessler (2008) the policies and practices involved in carrying out the “people” or human
resource aspects of a management position, including recruiting, screening, training, rewarding, and
appraising comprises of HRM.
Generally HRM refers to the management of people in organizations. It comprises of the activities, policies,
and practices involved in obtaining, developing, utilizing, evaluating, maintaining, and retaining the appropriate
number and skill mix of employees to accomplish the organization’s objectives. The goal of HRM is to
maximize employees’ contributions in order to achieve optimal productivity and effectiveness, while
simultaneously attaining individual objectives (such as having a challenging job and obtaining recognition),
and societal objectives (such as legal compliance and demonstrating social responsibility).
In short Human Resource Management (HRM) can be defined as the art of procuring, developing and
maintaining competent workforce to achieve the goals of an organization in an effective and efficient
manner.

1.4 Nature of HRM

HRM is a management function that helps manager’s to recruit, select, train and develop members for an
organization. HRM is concerned with people’s dimension in organizations.
The following constitute the core of HRM
1. HRM Involves the Application of Management Functions and Principles. The functions
and principles are applied to acquiring, developing, maintaining and providing remuneration to
employees in organization.
2. Decision Relating to Employees must be Integrated. Decisions on different aspects of
employees must be consistent with other human resource (HR) decisions.
3. Decisions Made Influence the Effectiveness of an Organization. Effectiveness of an
organization will result in betterment of services to customers in the form of high quality products
supplied at reasonable costs.
4. HRM Functions are not Confined to Business Establishments Only but applicable to non-
business organizations such as education, health care, recreation and like.
HRM refers to a set of programmes, functions and activities designed and carried out in order to maximize
both employee as well as organizational effectiveness.

1.5 Scope of HRM

The scope of HRM is indeed vast. All major activities in the working life of a worker – from the time of his
or her entry into an organization until he or she leaves the organizations comes under the purview of HRM.
The major HRM activities include HR planning, job analysis, job design, employee hiring, employee and
executive remuneration, employee motivation, employee maintenance, industrial relations and prospects
of HRM.
The scope of Human Resources Management extends to:
 All the decisions, strategies, factors, principles, operations, practices, functions, activities and
methods related to the management of people as employees in any type of organization.
 All the dimensions related to people in their employment relationships, and all the dynamics that
flow from it.
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 Union/Labour
Relations

Personnel Compensation
Research and and Benefits
Information
System

Human
resource Employee
Assistance
planning Human
resource
management

Design of the
Organization Organizational
and Job Development

Selection and
Staffing Training and
Development

Figure 1.1: Scope of HRM

The scope of HRM is really vast. All major activities n the working life of a worker – from the time of his
or her entry into an organization until he or she leaves it comes under the purview of HRM. American
Society for Training and Development (ASTD) conducted fairly an exhaustive study in this field and
identified nine broad areas of activities of HRM.

These are given below:

 Human Resource Planning
 Design of the Organization and Job
 Selection and Staffing
 Training and Development
 Organizational Development
 Compensation and Benefits
 Employee Assistance
 Union/Labour Relations
 Personnel Research and Information System

a) Human Resource Planning: The objective of HR Planning is to ensure that the organization has
the right types of persons at the right time at the right place. It prepares human resources inventory
with a view to assess present and future needs, availability and possible shortages in human resource.
Thereupon, HR Planning forecast demand and supplies and identify sources of selection. HR
Planning develops strategies both long-term and short-term, to meet the man-power requirement.

b) Design of Organization and Job: This is the task of laying down organization structure, authority,
relationship and responsibilities. This will also mean definition of work contents for each position
in the organization. This is done by “job description”. Another important step is “Job specification”.
Job specification identifies the attributes of persons who will be most suitable for each job which
is defined by job description.
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 c) Selection and Staffing: This is the process of recruitment and selection of staff. This involves
matching people and their expectations with which the job specifications and career path available
within the organization.
d) Training and Development: This involves an organized attempt to find out training needs of the
individuals to meet the knowledge and skill which is needed not only to perform current job but
also to fulfil the future needs of the organization.
e) Organizational Development: This is an important aspect whereby “Synergetic effect” is
generated in an organization i.e. healthy interpersonal and inter-group relationship within the
organization.
f) Compensation and Benefits: This is the area of wages and salaries administration where wages
and compensations are fixed scientifically to meet fairness and equity criteria. In addition labour
welfare measures are involved which include benefits and services.
g) Employee Assistance: Each employee is unique in character, personality, expectation and
temperament. By and large each one of them faces problems everyday. Some are personal some
are official. In their case he or she remains worried. Such worries must be removed to make him
or her more productive and happy.
h) Union-Labour Relations: Healthy Industrial and Labour relations are very important for enhancing
peace and productivity in an organization. This is one of the areas of HRM.
i) Personnel Research and Information System: Knowledge on behavioral science and industrial
psychology throws better insight into the workers expectations, aspirations and behaviour.
Advancement of technology of product and production methods have created working environment
which are much different from the past. Globalization of economy has increased competition
many fold. Science of ergonomics gives better ideas of doing a work more conveniently by an
employee. Thus, continuous research in HR areas is an unavoidable requirement. It must also take
special care for improving exchange of information through effective communication systems on a
continuous basis especially on moral and motivation.
HRM is a broad concept; personnel management (PM) and Human resource development (HRD) are a
part of HRM.

1.6 Objectives of HRM

The primary objective of HRM is to ensure the availability of competent and willing workforce to an
organization. The specific objectives include the following:

1) Human capital : assisting the organization in obtaining the right number and types of employees to
fulfill its strategic and operational goals
2) Developing organizational climate: helping to create a climate in which employees are encouraged
to develop and utilize their skills to the fullest and to employ the skills and abilities of the workforce
efficiently
3) Helping to maintain performance standards and increase productivity through effective job design;
providing adequate orientation, training and development; providing performance-related feedback;
and ensuring effective two-way communication.
4) Helping to establish and maintain a harmonious employer/employee relationship
5) Helping to create and maintain a safe and healthy work environment
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