Evolution Of Human Resource Management Functions

Evolution Of Human Resource Management Functions During the early stages of the industrial revolution, employees who worked in factories had to undergo extremely harsh conditions where they were underpaid and had to work for long hours under very poor conditions of hygiene. These conditions outraged the employees who worked in such factories and they initiated labor riots. As a result of these riots the government intervened to provide basic protection for labors or employees of such factories. This was done through the introduction of statutory regulations and all factory owners were required to comply with these statutory regulations. As a result the factory owners were forced to set up a department to look into employee wages, employee welfare and to address other issues concerning labor. This led to the development of Personnel Management. The evolution of Human Resource Management could be said to have started with the industrial revolution when factories had established personnel departments to look in to wages and welfare of employees. It could be said that the Personnel Management approach gave way to the Human Resource Approach. Personnel Administration: Personnel Administration concerns day to day activities and existing problems of employees. Personnel Administration could be identified as a reactive tool. Scientific Management: Scientific Management suggests there is a specific or a best way of doing things. In Scientific Management human beings were considered as machines, their feelings and attitudes were disregarded. The main aim of Scientific Management was only to maximize the productivity of the organization. Human Relations Movement: Human Relations Movement always anticipated the future unexpected occurrences before considering the current issues and believed in synergy. Government Regulations: Government Regulations were put into place so that all employees would at least get basic protection from basic forms of unfair treatment. There are mainly four acts which were put into place for this purpose. Equal Pay Act (1970) This act prohibits and less favorable treatment between men and women in terms of pay and conditions of employment. Here, the term pay is interpreted in a broad term and covers areas such as holidays, pension rights and company bonuses. Sex Discrimination Act or Gender Discrimination Act (1975) This act exists to protect men and women from discrimination on the grounds of sex. The Sex Discrimination act is mainly in relation to employment, training, education, harassment, provision of goods and services and in the disposal of premises. Race Relations Act (1976) This act exists to prevent discrimination on the grounds of race. The act also covers discrimination on the grounds of color, nationality, ethnicity, provision of goods and services, education and public functions. This act also established the Commission for Racial Equality. Disability Discrimination Act (1995) This act makes it unlawful to discriminate against people in respect of their disabilities in relation to employment, the provision of goods and services, education and transport. Human Resource Movement: With the Human Resource Movement greater attention was given towards social responsibility and social well being. There was more emphasis give to the relationship between employers and employees. Employee ideas and initiatives were encouraged. Strategic Human Resource Management: In Strategic Human Resource the importance of human resource considerations in long range strategic planning has been recognized. Under Strategic Human Resource Management not only one section or department of the organization would be considered but instead the organization as a whole would be considered. The Personal Management Approach (Early 20th Century) The usage of Personnel Management Approach was prominent throughout the early 20th century even though it remained administrative in nature. The Personnel Management Approach mainly concerned itself with, Keeping employee records Ensuring compliance with stated policies Implementation of functions such as recruitment, training and wage administration Taking welfare oriented measures such as providing medical care and vaccinations Attempting to increase productivity through wage increases and training, and enforcement of standards Dealing with trade unions and trying to solve industrial disputes through collective bargaining and other industrial relations approaches Conducting performance appraisals The Personnel Management Approach tried to convince workers of the business interests, and convince management of workers interest and also increase awareness of business about social responsibility. Personnel Management was mostly not involved in the companys strategy and operations aspect. The Traditional Human Resource Approach (Late 20th Century) The Traditional Human Resource Approach evolved during the late 20th century with the development and introduction of new theories such as Maslows hierarchy of needs theory. In the Human Resource Approach the employees of an organization were considered as valuable resources. Unlike the Personnel Management Approach the Traditional Human Resource Approach was not merely a staff function but it was more and more involved with business operations. The following could be identified as the main differences between the Personnel Management Approach and the Traditional Human Resource Approach. Motivation was given to employees through various forms such as free holidays, creating an active and social community within the workforce besides monetary incentives. Training and Development was not only focused on providing work related skills but also focused on changing attitudes and development of basic skills Wage and Salary Administration became more complex with the introduction of performance related payment schemes The Strategic Human Resource Approach (21st Century) The Strategic Human Resource Approach aligns individual goals and objectives with corporate goals and objectives, and rather than enforce rules or dictate terms, acts as a facilitator and promotes a participative approach. The following could be identified as the main differences between the Traditional Human Resource Approach and the Strategic Human Resource Approach. Increased reliance on performance based short term contracts instead of long term employment Direct linkage of compensation to the profitability of the enterprise and the employees contribution towards such profitability New dimensions for training and development function by encouraging and facilitating innovation and creativity How Personnel Management and Human Resource Management Differ Personnel Management can be viewed as a tool and it concerns organizational rules and regulations and also ongoing issues. Whereas, Human Resource Management first looks in to the long lasting future and analyzes Human Resource needs. Further, Human Resource Management uses an integrated approach to achieve those needs with the congruence of corporate objectives. Role, Tasks and Activities of a Human Resource Practitioner A Human Resource Practitioner has the opportunity to help shape the success of any organization. There are many roles, tasks and activities that a Human Resource Practitioner should do such as, Maintain and implement an effective HR data system and also manage the filing system and records for the department. Document and update job profiles for all employees. Maintain and review approved manpower plan with the relevant stakeholders on a continuous basis as per the identified needs and requirements. Develop and implement a Project Employment equity plan as champion / driver of the function. Ensure timed contracting and processing of employment and compensation matters. Ensure all terminations are processed timorously in that structured exit interviews are conducted for employees, leaving and relevant documentation completed. Distribute records to and liaise with all relevant departments within the Company. Assist in developing and implementing new and reviewing existing policies and procedures. Conduct roll-out sessions with staff. Handle all HR / personnel related queries and correspondence timorously and escalate if needed. Ensure orientation and induction for all new employees on HR related issues are conducted. Implement, support, advise, coordinate, monitor and report on Performance Management System. Reporting compile and distribute reports on HR activities. Maintain leave records and execute leave audits when required. Employee relations. Employee wellness. Role of a Line Manager Line managers are managers who are responsible for an employee or work group. Many organizations line managers now carry out activities, which were traditionally within the remit of HR such as providing coaching and guidance, undertaking performance appraisals and dealing with discipline and grievances. In many cases, they also carry out recruitment and selection in conjunction with HR. First, it is important for line managers to keep a positive relationship with their employees, so that the employees will have higher level of job satisfaction, commitment and loyalty, which are associated with higher levels of performance or discretionary behavior. A line manager can also attend to the above-mentioned if he or she does performance appraisal. In addition, Line managers also play a strong part in structuring peoples actual experience of doing a job. Never the less, it is important that line managers see through the weaknesses of the work force and guide, train or coach them with proper directions where the employees can perform their work in a higher manner. In the role of a line manager, they always involve the employees in communication, especially when it comes to taking decisions or solving a problem in the line this also known as employee engagement. When working as a line manager and playing its role, the employees should feel easy and comfortable to discuss matters with their line managers. Therefore, the line managers should be opened to his or hers loyal work force. Last but not the least it is very important for a line manager to recognize the contribution of an employee to his work place. Line Management Responsibilities To have a good working relationship with the people who works under the line managers they will have to have some responsibilities that would make it effective. There are some factors that should be taken in to consideration such as, The Line Manager should make an effort to build a relationship with the workers under him that would be productive to the company. When the manager builds a good relationship with the workers, the workers will be happy to work and they can have discussions and gain more ideas through the workers knowledge as well. The team work with the workers will be very effective and this will increase the productivity of the company. The Line Manager should very careful when he conducts the performance of the employees since it might affect the employee positively or negatively. The Line Manager must provide more opportunities to the employees to have more discussions, more work, and responsibilities of the activities they do in order to get them more confident on a regular basis. This will help the employees know what the targets are and they will be kept remembered. This will help them stay focused and work in order to achieve the target. The focus on the performance and the work that the employee and manager do must be a two way process and both of them should be able to discuses and express their opinion about the performance and what are the factors that affect the final outcome. The Line Manager should set an example in a way that he would be the first one to reference by any employee when a problem arises or when a decision must be made. This also means gaining the respect that is needed by a manager must be earned by the Line manager. The Line Manager should provide regular updates on information and knowledge to the employees in order to keep them sharp. Some information and knowledge can be only accessed by the manager and it is up to the manager to ensure he updates on employees on their employees significant areas. The manager must make sure he has regular meeting and discussions in order to inform the employees on the development, problems and also remind them the goals and objectives of the company. So the employees know what is happening around the company and how they must act to overcome the issues. The Line Manager must identify the employees strength and weakness personally and must be able to make use of it for the benefit of the company. If an employee has a particular strength the manager must use it to the advantage of the company and if the employee has a weakness then the manager must help the employee to overcome this weakness. The Line Manager should appreciate the employees on their good work and as well as advice them on the inappropriate work. The manager must be able to send the message straight and make himself clear for the employees. The Line Manager should provide advice and support when it is needed by the employees. The Line Manager should support the fact that some employees need training and he must help them gain it. To carry out all these responsibilities efficiently the Line Manager needs to know all the employees job description and work specification. So when the Line Manager has a clear view on that the clarity will exist when making decision and as well as the Line Manager will know the limits of each employees. So being a Line Manager the managers responsibilities are mainly having a good relationship with the employees and understanding their needs and wants and leading them to do the activities that the manager requires them to do. Making the employees work in a way that they are satisfied with their work and letting them know that the company does care about them in order for them to work with their heart. Any manager must know how to get to any employee since not all the employees are the same and not everyone will be satisfied with the way the manager treats the employees. Hence, understanding the employees demands and understanding a way to gain their respect is very vital. Human resource planning Human resource planning is the term used to describe how companies ensure that their staff is the right staff to do the jobs. It is a systematic process of matching the interest, skills, and talents of individual community members with the long term goals and economic opportunities in the community. This process anticipates and maps out the consequences of business strategy on an organizations human resources. It is reflected in planning of skill and competence needs as well as total headcounts. For resourcing strategies to be implemented they must be translated into practical action. The strategic process can be organized logically. For these decisions to be taken, information must be obtained, consequences gauged, political soundings taken and preferences assessed. A clear Human resource plan includes benefits such as: Highlighting opportunities for strategic partnership that allow communities and other partners to share the benefits, risks and training costs. It provides for small successes that are encouraging and motivating for the community members and others that the program is on track. Making it easy to evaluate progress (especially client feedback) and to present funders, partners, and community members with effective information about the progress. The Human Resource Planning Process In order to compartmentalize the Human Resource Planning process, it will be broken down under five main general headings, under which each company will be analyzed against, so that the contrast in how they differ in planning processes can be identified Environmental Analysis The first step in the human resource planning process is to understand the context of human resource management. Human resource managers should understand both internal and external environments. Data on external environments includes the following: the general status of the economy, industry, technology and competition; labor market regulations and trends; unemployment rate; skills available; and the age and sex distribution of the labor force. Internal data required include short- and long-term organizational plans and strategies and the current status of the organizations human resources. In Standard Chartered, Human Resource Managers have surveyed the environmental arena and have undertaken activities that enhance their business performance now and for the long-term. They have also look for ways to ensure the economic development of the countries Standard Chartered Bank operates in, how to have a positive impact on the environment and society, as well as contributing to good governance. Human Resources have helped maintain an integrated view of how Standard Chartered does business that takes into account economic factors, the environment, community, and good governance. They have identified seven sustainability priorities by consulting key stakeholders such as government, academics, socially responsible investors, non-governmental organizations (NGOs) and peers. They now deliver on this agenda by using the core skills and talents of their employees; providing quality financial services; and leveraging Standard Chartered Banks geographical footprint and international status to be a force for good. Standard Chartered Banks Human Resource Managers have thus analyzed its environment and have enhanced their labor and employment practices through collective bargaining agreements with the Local Unions and focused interaction with all labor regulatory authorities and agencies thus demonstrating the promotion of the principles of human and labor rights. The Bank also has a Diversity Inclusion (DI) Council. Designing the Management System A proper concise system is a vital necessity and needs to be in place, in order to handle the Human Resource process. The overall aim of this system is to manage human resources in line with organizational goals. The system is in charge of human resource plans, policies, procedures and best practices. For example, the system should track emerging human resource management trends, such as outsourcing certain non-core functions, adopting flexible work practices and the increased use of information technology, and, if appropriate, implement them. Standard Chartered Bank has signed a seven-year outsourcing contract, worth US$200 million, with Atos Origin for the management of its data services infrastructure in the Asia Pacific region. The agreement covers the banks data services in Hong Kong, Singapore and Malaysia. Atos Origin says it will aim to deliver improved performance levels and costs to the bank through the deployment of new technology and the standardization of processes. Commercial banks Human Resource system took a different approach and identified a more lucrative benefit can be made by outsourcing their existing pension scheme. Thus it resulted in the bank hiring Hewitt Outsourcing Services (India) Ltd, to convert its existing pension scheme, from a defined benefit plan to a defined contribution plan. As a result the group post-tax profits rose 39.46 percent to 2.37 billion rupees during the nine month period, compared with the same period last year. Analyzing Supply Organizations can hire personnel from internal and external sources. The skill inventories method is one of the techniques used to keep track of internal supply. Skill inventories are manual or computerized systems that keep records of employee experience, education and special skills. A forecast of the supply of employees projected to join the organization from outside sources, given current recruitment activities, is also necessary. For example, Standard Chartered, during the recession, Human Resource analyzing the surplus in employees, and having to cost cut to coincide with the new survival strategies of the company started to take attrition approach. Attrition is the process whereby the existing employees leave their jobs for various reasons or gets downsized. Those jobs will be kept vacant or unfilled. Attrition or hiring freezes or ban on employment can be implemented organization-wide or department-wise or job-wise if the Human Resource Manager forecasts a surplus manpower in the organization. But if the attrition rate is continuous and high then it is high time the concerned authorities in the organization have introspection and take remedial actions. High Attrition is a sign of bad reputation for the organization as a working place. Under the analyzing supply in terms of Human Resource planning process Commercial Bank operates on a different avenue. If future surplus is estimated, Commercial Bank has to plan for redeployment, redundancy etc. If surplus is estimated in some jobs/department, employees can be redeployed in other jobs/departments where the deficit of employees is estimated. Commercial Bank also makes plans for training or reorientation before redeployment of employees. Redeployment takes place in the form of transfers. If the deficit is not estimated in any job/department and surplus is estimated for the entire organization, Commercial Bank then, starts consultation with the trade unions and plans for redundancy or retrenchment. Reconciliation and Planning The final step in human resource planning is developing action plans based on the gathered data, analysis and available alternatives. The key issue is that the plans should be acceptable to both top management and employees. Plans should be prioritized and their key players and barriers to success identified. Some of these plans include employee utilization plan, appraisal plan, training and management development plan and human resource supply plan. A good example of this would be to go back to the times where recession hit, and Standard chartered had done extensive research on employee utilization plan, and more importantly the downsizing to keep them afloat. The HR identified key managers and put into action a redundancy plan which was as followed: Standard Chartered redundancy plan This plan covered type and number of employees, time of and place of retrenchment, type of help to be extended to retrenched employees in the form of compensation, help in getting new job, priority in filling future vacancies. Redeployment, Redundancy/Retrenchment Programs: 1. Outplacement: Outplacement programs also intended to provide career guidance for displaced employees. This programs covers retraining the prospective displaced employees who can be redeployed elsewhere in the organization, helping in resume writing, interview techniques, job searching. 2. Layoffs: Layoffs can be temporary or permanent. Temporary layoffs are due to the slackness in business, machinery breakage, power failure etc. Workers are called back as soon as work resumes to the normal position. Permanent layoff is due to liquidation of the company. Proper human resource planning leaving the workforce at proper level can help to reduce this effect. 3. Leave of Absence without Pay: This technique helps SC to cut the labor cost and the employee to pursue his self interests. This technique also helps the company to plan for eliminating the unnecessary job in a phased manner. This concept serves or a productive method to help employees prepare for future changes. Work Sharing: Some areas of SC offer employees the opportunity to share jobs or two employees working one-half time each. This technique solves the problem of retrenchment in the short run. This is in vogue in advanced countries but not acceptable to workers unions especially within the Asian region. Reduced Working Hours: Under this technique, each worker, works less hours, and receives less pay, so that two jobs are saved. Again this is not prevalent in the Asian region and other developing countries. Voluntary/ Early Retirement: Another issue is early retirement. SC has taken a page from the Government of India who introduced Voluntary Retirement Scheme under the caption Golden Handshake in order to solve the problem of overstaffing in Public sector. This technique solves the problem of excessive supply of future inventory over the demand for the human resources. In short it is popularly called as VRS. Evaluation of the Recruitment Selection Procedure of Both Standard Chartered Bank and Commercial Bank. Recruitment: The aim of the recruitment is to ensure that the Organizations demand for employees is met by attracting potential employees (recruits) in a cost effective and timely manner. Selection: Employee Selection is the process of putting right men on right job. It is a procedure of matching organizational requirements with the skills and qualifications of people. Effective selection can be done only when there is effective matching. By selecting best candidate for the required job, the organization will get quality performance of employees. Standard Chartered Bank Recruitment process of Standard Chartered Bank The banks Management Development Scheme takes place in Colombo, where they recruit management trainees. Never the less, Standard Chartered Bank has provided the opportunity for those candidates who are interested in this scheme to apply to their local cities. Per year around 40 management associates are been recruited. The aim of the management is to recruit graduates and post graduates with different backgrounds and experiences yet, the best and the brightest talent in market. Whom do they recruit? Young and talented graduates or postgraduates, who are willing to start their career in the financial service industry Career-oriented person Consistent academic performer throughout his/her education Innovative, ambitious, energetic and business oriented person Recruitment criteria Standard Chartered Bank recruits the most talented individuals from the external market to supplement their internal pipeline of talent. Their Human Resources department provides guidance on the use of psychometric tests and has robust recruitment criteria to ensure that all candidates are treated fairly, equally and with respect. It has a global Graduate Recruitment Program; where in the region of 150 graduates are recruited each year on a management trainee program across all businesses, functions and countries. Analysis for Standard Chartered Banks recruitment Human Resource Recruitment is defined as any practice or activity carried on by the organization with the primary purpose of identifying and attracting potential employees. The goal of an organizational recruitment program is to ensure that the organization has a number of reasonably qualified applicants (who would find the job acceptable) to choose from when a vacancy occurs. Selection Process of Standard Chartered Bank Employee selections at Standard Chartered Bank are based on knowledge, skills and talent. The bank is committed to provide the equal opportunities to all employees regardless of gender, race, age, disability, nationality, ethnic origin or material status. Never the less, Standard Chartered Bank also identifies what unique strengths each individual brings, to the roles they carry out and the development of these strengths. Standard Chartered Bank mostly uses face-to-face interviews as their selection method. Therefore, when suitable applicants are been chosen through the recruitment process the bank set appointments for interviews with them. Afterwards, upon arrival, have each interviewee fill out a job application form and give them a copy of the positions written job description. After interviews are completed, human resource manager of Standard Chartered Bank selects two or three candidates that fits for the vacant job and have them come in for a follow-up interview. This is where the management discuses about salary, benefits etc. Thereafter, the final employee selection takes place based upon these second-level interviews and makes an offer to the Human Resource Managers first choice. Analysis for Standard Charted Banks selection Any organization that intends to compete through people must take the utmost care with how it chooses organizational members. Personnel selection is the process by which companies decide who will or will not be allowed into their organization. Several generic standards should be met in any selection process, which are reliability, validity, utility, and legality. Standard Chartered selects employees based on knowledge, skills and talent. They are committed to providing equality of opportunity to all employees, regardless of gender, race, nationality, age, disability, ethnic origin, or marital status. Commercial Bank Recruitment Process of Commercial Bank The human resources staff at Commercial Bank first makes sure recruitment plans are set based on business goals and analyzing of history. Then looks at the job a requirement and list the skills, knowledge, experience and ability needed. Mainly the recruitment activities of the bank are carried out at least four times per year. Shown below are some figures, which have been taken from a past year. Five employees retired under normal retirements. Fifteen resigned under voluntary retirement. Four resigned Four dismissed. Three expired during the period under view. Commercial Bank has also come up with new recruitment opportunities due to the expansion of the bank. Therefore, to fill these vacancies Commercial Bank follows the internal and external recruitment methods. Whereas, it should be noted that when there is a vacancy the bank first tries to fill the space with an existing employee by following the internal recruitment method. If the requirements cannot be met by the internal method then they move into the external recruitment. In addition, it is clear that the bank follows both ways to select the best candidate. The internal procedure This method is used to fill a vacancy of Commercial Bank, using an existing employee with the right requirements and qualifications. Therefore, if there is any vacancy the management of the bank will advertise it in the internal newsletter, which is handed over to all the employees making more space for opportunities. Within one weeks time if the bank finds a suitable person from the company itself to fill the vacant position, most probably they are given the job. Commercial Bank faces many advantages due to the internal recruitment method. They are as show below, Cost effectiveness the bank should invest money upon recruitment, selection and training development when picking an employee externally. This can cut off by the internal method of recruitment. Gives more motivation to all the employees and leads to promotions. Increase commitment to the company by the employees. The external procedure Commercial Bank d