Human Resource Management (HRM)?

Human Resource Management (HRM) is an operation in companies designed to maximize employee performance in order to meet the employer's strategic goals and objectives. More precisely, HRM focuses on management of people within companies, emphasizing on policies and systems.
In short, HRM is the process of recruiting, selecting employees, providing proper orientation and induction, imparting proper training and developing skills.
HRM also includes employee assessment like performance appraisal, facilitating proper compensation and benefits, encouragement, maintaining proper relations with labor and with trade unions, and taking care of employee safety, welfare and health by complying with labor laws of the state or country concerned.

The Scope of HRM

The scope of HRM is very wide. It consists of all the functions that come under the banner of human resource management. The different functions are as follows −

Human Resources Planning

It is the process by which a company identifies how many positions are vacant and whether the company has excess staff or shortage of staff and subsequently deals with this need of excess or shortage.

Job Analysis Design

Job analysis can be defined as the process of noticing and regulating in detail the particular job duties and requirements and the relative importance of these duties for a given job.
Job analysis design is a process of designing jobs where evaluations are made regarding the data collected on a job. It gives an elaborate description about each and every job in the company.

Recruitment and Selection

With respect to the information collected from job analysis, the company prepares advertisements and publishes them on various social media platforms. This is known as recruitment.
A number of applications are received after the advertisement is presented, interviews are conducted and the deserving employees are selected. Thus, recruitment and selection is yet another essential area of HRM.

Orientation and Induction

After the employees are selected, an induction or orientation program is organized. The employees are updated about the background of the company as well as culture, values, and work ethics of the company and they are also introduced to the other employees.

Training and Development

Employees have to undergo a training program, which assists them to put up a better performance on the job. Sometimes, training is also conducted for currently working experienced staff so as to help them improve their skills further. This is known as refresher training.

Performance Appraisal

After the employees have put in around 1 year of service, performance appraisal is organized in order to check their performance. On the basis of these appraisals, future promotions, incentives, and increments in salary are decided.

Compensation Planning and Remuneration

Under compensation planning and remuneration, various rules and regulations regarding compensation and related aspects are taken care of. It is the duty of the HR department to look into remuneration and compensation planning.

Features of HRM

Human Resource Management as a discipline includes the following features −

• It is pervasive in nature, as it is present in all industries.
• It focuses on outcomes and not on rules.
• It helps employees develop and groom their potential completely.
• It motivates employees to give their best to the company.
• It is all about people at work, as individuals as well as in groups.
• It tries to put people on assigned tasks in order to have good production or results.
• It helps a company achieve its goals in the future by facilitating work for competent and well-motivated employees.
• It approaches to build and maintain cordial relationship among people working at various levels in the company.

Basically, we can say that HRM is a multi-disciplinary activity, utilizing knowledge and inputs drawn from psychology, economics, etc.
Human Resource Management is a process of bringing people and organizations together so that the goals and objectives of each are achieved. In this chapter, we will discuss how important it is to ensure that the HR functions are properly aligned with the overall business strategy of an organization.

Integrating HR Strategy with Business Strategy

Today, human resource departments have a more precise, strategic role in companies, and an HR strategy affects the bottom line. Let us look into HR as part of a complete business strategy.

HR Strategy as Business Strategy

In real world, no margin in the sand is drawn between human resources strategy and business strategy. A successful business owner understands the strong connection between the two. Progressing human capital is essential to the longevity and success of a business.
Human resources strategy today includes executive leadership teams conferring with human resources experts to improvise complementary goals for human resources and the complete business.

HR Strategy and Business Productivity

The recruitment and selection process in human resources department is paramount to creating a productive workforce. Maintaining a workforce where employees enjoy high levels of job satisfaction and job security converts into a workforce that assists in achieving business goals.

Trends Affecting HR and Business Strategy

Presently, we can say that HR technologies have become an integrated engine in advancing the broader needs of businesses, supporting far more than the basic transactions, and advancing HR and business agenda for future.
Human resources information system (HRIS) is integral to the progress of performance management, recruitment, selection. It also plays a vital role in the rejection of candidates, their promotions and postings, etc.

Interaction among Executive Leadership

The best way to cultivate a relationship between HR and C-level executives is by demonstrating the return on investment (ROI) in human resources activities and practices. This may include explaining the link between reduction in employee turnover and improvement in job satisfaction that improves the bottom line.

Example

Till now, we are very clear about integration of HR strategy with business strategy, business productivity, their interdependencies and the way their relationship influences the organization as a whole.
Let us now take an example to understand the concepts better.

Company X functions from the northeast corner of India. Its functions are limited to the local area only and they have projected their income and gains on that basis.
Due to the prevailing restrictions in the area, the Company has to hire its staff from the local population, who are not professionally qualified. However, the Company ropes in the services of a professionally qualified experienced CEO, who is a techno-commercial man and has the duty to manage the organization centrally.
The CEO interacts with almost all the staff and arranges for on the job training for them. As the employees are not professionally qualified, there is little fear that they will change the job after getting trained.
In this case, lack of local competition goes in the Company's favor. The Company however ensures that it recruits hard working, focused and committed personnel. The salary policy of the Company is such that each candidate is able to earn enough to meet the basic needs.