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COURSE NO. 202: HUMAN RESOURCE MANAGEMENT Concepts and Perspectives on Human Resource Management, Human Resource Management in a changing Environment, Cor-porate objectives and Human Resource Planning; Career and Succession Planning; Job Analysis and Role Description; Methods of Manpower Search, Attracting and Selecting Human Resources; Induction and Socialisation, Manpower Training and Devel-opment; Performance Appraisal and Potential Evaluation; Job Evaluation, & Wage Determination; Employees Welfare; Industri-al Relations & Trade Unions; Dispute Resolution & Grievance Management, Employee Empowerment PRESPECTIVES ON HUMAN RESOURCE MANAGEMENT Five different perspectives of human resource management (HRM) include the normative perspective, the critical perspective,

behavioural perspective, systems perspective, and agency or transaction cost perspective.

The Normative Perspective - The normative perspective of human resource management bases itself on the concepts of “hard

HRM" and “soft HRM," on which the foundations of human resource management rest.

The concept of “Hard HRM" is the basis for the traditional approach toward human resource management. This concept traces

its origins to the Harvard model that links workforce management to organizational strategy. Hard HRM stresses the linkage of

functional areas such as manpower planning, job analysis, recruitment, compensation and benefits, performance evaluations,

contract negotiations, and labour legislations to corporate strategy. This enforces organization interests over the employees'

conflicting ambitions and interests. It views the workforce as passive resources that the organization can use and dispose at will.

Soft HRM is synonymous with the Michigan model of human resources and is the bedrock of the modern approach to strategic

human resource management. This model considers human capital as “assets" rather than “resources" and lays stress on organ-

izational development, conflict management, leadership development, organizational culture, and relationship building as a

means of increasing trust and ensuring performance through collabouration. This approach works under the assumption that

what is good for the organization is also good for the employee.

The Critical Perspective of Human Resource Management - The critical perspective of human resource management is a reac-

tion against the normative perception. This highlights some inherent contradictions within the normative perspective.

This perspective espouses a gap between rhetoric, as organizations claim to follow soft HRM policies when they actually enforce

hard HRM. A study by Hope-Hailey et al. (1997) finds that while most organizations claim employees to be their most important

assets and make many commitments for their welfare and development, in reality employers enforce a hard HRM-based strate-

gic control, and the interests of the organization always take priority over the individual employee.

The Behavioural Perspective of Human Resource Management - The behavioural perspective of human resource manage-

ment has its roots in the contingency theory that considers employee behaviour as the mediator between strategy and organi-

zational performance. This theory holds that the purpose of human resource intervention is to control employee attitudes and

behaviours to suit the various strategies adopted to attain the desired performance. This perspective thus bases itself on the

role behaviour of employees instead of their skills, knowledge, and abilities.

5 Famous Indian ‘No Nonsense’ Grandmothers TATA Coffee

For instance, an organization aiming to innovate will require a workforce that demonstrates a high degree of innovative behav-

iour such as long-term focus, cooperation, concern for quality, creativity, propensity for risk taking, and similar qualities. The

role of human resource management in such a context is to inculcate and reinforce such behavioural patterns in the workforce.

The Systems Perspective of Human Resource Management - The systems perspective describes an organization in terms of in-

put, throughput, and output, with all these systems involved in transactions with a surrounding environment. The organized ac-

tivities of employees constitute the input, the transformation of energies within the system at throughput, and the resulting

product or service the output. A negative feedback loop provides communications on discrepancies.

The role of human resource management in the systems perspective is

1. Competence management to ensure that the workforce has the required competencies such as skills and ability to provide the

input needed by the organization.

2. Behavior management through performance evaluation, pay systems, and other methods to ensure job satisfaction, so that

employees work according to the organizational strategy, ultimately boosting productivity.

3. Setting up mechanisms to buffer the technological core from the environment in closed systems.

4. Facilitating interactions with the environment in open systems.

Agency or Transaction Cost Perspective of Human Resource Management - Among the different perspectives of human re-

source management is the agency or transaction cost perspective, which holds the view that the strong natural inclination of

people working in groups is to reduce their performance and rely on the efforts of others in the group. When one person

delegates responsibility to another person, conflicts of interests invariably arise.

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The major role of human resource management in such a context is to promote alternative ways of controlling behaviour to re-

duce the effects of such conflicts and minimize the cost to the organization. The two major approaches include

1. Monitoring employee behaviour and preventing shrink of work by establishing effective control systems and improving productivity.

2. Providing employees with incentives such as rewards, motivation, and job satisfaction to increase their individual performance.

The human resource department needs to adopt the approach that minimizes transaction cost to the organization.

Human Resource Management: Meaning, Objectives, Scope and Functions

Meaning: Before we define HRM, it seems pertinent to first define the term ‘human resources’. In common parlance, human re-

sources means the people. However, different management experts have defined human resources differently. For example,

Michael J. Jucius has defined human resources as “a whole consisting of inter-related, inter-dependent and interacting physio-

logical, psychological, sociological and ethical components”.

According to Leon C. Megginson “From the national point of view human resources are knowledge, skills, creative abilities, tal-

ents, and attitudes obtained in the population; whereas from the view-point of the individual enterprise, they represent the to-

tal of the inherent abilities, acquired knowledge and skills as exemplified in the talents and aptitude of its employees”.

Sumantra Ghosal considers human resources as human capital. He classifies human capita into three categories-intellectual cap-

itals, social capital and emotional capital. Intellectual capital consists of specialized knowledge, tacit knowledge and skills, cogni-

tive complexity, and learning capacity.

Social capital is made up of network of relationships, sociability, and trustworthiness Emotional capital consists of self-

confidence, ambition and courage, risk-bearing ability, and resilience. Now it is clear from above definitions that human re-

sources refer to the qualitative and quantitative aspects of employees working in an organisation.

Let us now define human resource management.

In simple words, HRM is a process of making the efficient and effective use of human resources so that the set goals are

achieved. Let us also consider some important definitions of HRM.

According to Flippo “Personnel management, or say, human resource management is the planning, organising, directing and

controlling of the procurement development compensation integration, 4intenance, and separation of human resources to the

end that individual, organisational and social objectives are accomplished”.

The National Institute of Personnel Management (NIPM) of India has defined human resource/personnel management as “that

part of management which is concerned with people at work and with their relationship within an enterprise. Its aim is to bring

together and develop into an effective organisation of the men and women who make up an enterprise and having regard for

the well-being of the individuals and of working groups, to enable them to make their best contribution to its success”.

According to Decenzo and Robbins “HRM is concerned with the people dimension in management. Since every organisation is

made up of people, acquiring their services, developing their skills, motivating them to higher levels of performance and ensur-

ing that they continue to maintain their commitment to the organisation are essential to achieving organisational objectives.

This is true, regardless of the type of organisation-government, business, education, health, recreation, or social action”.

Thus, HRM can be defined as a process of procuring, developing and maintaining competent human resources in the organisa-

tion so that the goals of an organisation are achieved in an effective and efficient manner. In short, HRM is an art of managing

people at work in such a manner that they give their best to the organisation for achieving its set goals.

Objectives: The primary objective of HRM is to ensure the availability of right people for right jobs so as the organisational goals

are achieved effectively.

This primary objective can further be divided into the following sub-objectives:

1. To help the organisation to attain its goals effectively and efficiently by providing competent and motivated employees.

2. To utilize the available human resources effectively.

3. To increase to the fullest the employee’s job satisfaction and self-actualisation.

4. To develop and maintain the quality of work life (QWL) which makes employment in the organisation a desirable personal

and social situation.

5. To help maintain ethical policies and behaviour inside and outside the organisation.

6. To establish and maintain cordial relations between employees and management.

7. To reconcile individual/group goals with organisational goals.

Werther and Davis have classified the objectives of HRM into four categories as shown in table 1.2.

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Table 1.2: HRM Objectives and Functions:

Scope: The scope of HRM is, indeed, very vast and wide. It

includes all activities starting from manpower planning till

employee leaves the organisation. Accordingly, the scope of

HRM consists of acquisition, development, mainte-

nance/retention, and control of human resources in the or-

ganisation (see figure 1.1). The same forms the subject mat-

ter of HRM. As the subsequent pages unfold, all these are

discussed, in detail, in seriatim.

The National Institute of personnel Management, Calcutta

has specified the scope of HRM as follows:

1. The Labour or Personnel Aspect: This is concerned with

manpower planning, recruitment, selection, placement,

transfer, promotion, training and development, lay-off and

retrenchment, remuneration, incentives, productivity,

etc.

2. Welfare Aspect: It deals with working conditions,

and amenities such as canteen, creches, rest and lunch

rooms, housing, transport, medical assistance, educa-

tion, health and safety, recreation facilities, etc.

3. Industrial Relations Aspects: This covers union-

management relations, joint consultation, collective

bargaining, grievance and disciplinary actions, settle-

ment of disputes, etc.

Functions: We have already defined HRM. The defini-

tion of HRM is based on what managers do. The func-

tions performed by managers are common to all organizations. For the convenience of study, the function performed by the re-

source management can broadly be classified into two categories, viz.

(1) Managerial functions, and (2) Operative functions (see fig. 1.2).

These are discussed in turn.

(1) Managerial Functions: - Planning: Planning is a predetermined course of actions. It is a process of determining the organisa-

tional goals and formulation of policies and programmes for achieving them. Thus planning is future oriented concerned with

clearly charting out the desired direction of business activities in future. Forecasting is one of the important elements in the

planning process. Other functions of managers depend on planning function.

Organising: Organising is a process by which the structure and allocation of jobs are determined. Thus organising involves giving

each subordinate a specific task establishing departments, delegating authority to subordinates, establishing channels of au-

thority and communication, coordinat-

ing the work of subordinates, and so

on.

Staffing: TOs is a process by which

managers select, train, promote and

retire their subordinates This involves

deciding what type of people should be

hired, recruiting prospective employ-

ees, selecting employees, setting per-

formance standard, compensating em-

ployees, evaluating performance,

counseling employees, training and

developing employees.

Directing/Leading: Directing is the

process of activating group efforts to

achieve the desired goals. It includes

activities like getting subordinates to

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get the job done, maintaining morale motivating subordinates etc. for achieving the goals of the organisation.

Controlling: It is the process of setting standards for performance, checking to see how actual performance compares with the-

se set standards, and taking corrective actions as needed.

(2) Operative Functions: = The operative, also called, service functions are those which are relevant to specific department.

These functions vary from department to department depending on the nature of the department Viewed from this standpoint,

the operative functions of HRM relate to ensuring right people for right jobs at right times. These functions include procure-

ment, development, compensation, and maintenance functions of HRM.

A brief description of these follows:

Procurement: It involves procuring the right kind of people in appropriate number to be placed in the organisation. It consists of

activities such as manpower planning, recruitment, selection placement and induction or orientation of new employees.

Development: This function involves activities meant to improve the knowledge, skills aptitudes and values of employees so as

to enable them to perform their jobs in a better manner in future. These functions may comprise training to employees, execu-

tive training to develop managers, organisation development to strike a better fit between organisational climate/culture and

employees.

Compensation: Compensation function involves determination of wages and salaries matching with contribution made by em-

ployees to organisational goals. In other words, this function ensures equitable and fair remuneration for employees in the or-

ganisation. It consists of activities such as job evaluation, wage and salary administration, bonus, incentives, etc.

Maintenance: It is concerned with protecting and promoting employees while at work. For this purpose virus benefits such as

housing, medical, educational, transport facilities, etc. are provided to the employees. Several social security measures such as

provident fund, pension, gratuity, group insurance, etc. are also arranged.

It is important to note that the managerial and operative functions of HRM are performed in conjunction with each other in an

organisation, be large or small organisations. Having discussed the scope and functions of HRM, now it seems pertinent to de-

lineate the HRM scenario in India.

Changing Environment of Human Resource Management (HRM)

The five factors involved in the changing environment of HRM are as follows: 1. Work force Diversity 2. Economic and Techno-

logical Change 3. Globalization 4. Organisational Restructuring 5. Changing Nature of Work.

Business environment is changing environment and so is HR environment. The changing environment of HRM includes work

force diversity, economic and technological change, globalisation, organisational restructuring, changes in the nature of jobs

and work and so on.

1. Work force Diversity: Diversity has been defined as any attribute that humans are likely to use to tell themselves, that person

is different from me and, thus, includes such factors as race, sex, age, values, and cultural norms’. The Indian work force is char-

acterized by such diversity that is deepening and spreading day by day.

It is likely to be more diverse as women, minority- group members, and older workers flood the work force. With the increasing

number of women entering the work force due to a combination of factors like women’s emancipation, economic needs, great-

er equality of sexes, education and so on, additional pressures of managing a different set of problems at the work place have

arisen. As such, the number of women is on increase in all walks of life i.e., teachers, lawyers, doctors, engineers, accountants,

pilots, parliamentarians and so on.

However, increasing number of women in the work force has been necessitating the implementation of more flexible work

scheduling, child care facilities, maternity and now paternity leave also and transfer to location of husband’s place of posting.

Also, as the work force ages, employers will have to grapple with greater health care costs and higher pension contributions. On

the whole, the increased diversity of work force will place tremendous demands on the HR management function.

Further, creating unanimity from a diverse work force has also become a challenge for HR manager. This is because, as several

experts’ put it; diversity is marked by two fundamental and inconsistent realities operating today with it. One is that organisa-

tions claim they seek to maximize diversity in the work place, and maximize the capabilities of such a diverse work force.

The other is that traditional human resources system will not allow diversity, only similarity. These experts emphasize that em-

ployers traditionally hire, appraise, and promote people who fit a particular employer’s image of what employees should be-

lieve and act like. At the same time, there is corresponding tendency to screen out those who do not fit.

2. Economic and Technological Change: Along with time, several economic and technological changes have occurred that have

altered employment and occupational pattern. In India too, there is a perceptible shift in occupational structure from agricul-

ture to industry to services.

The New Economic Policy, 1991 has led to liberalization and globalization giving genesis to multinational organisations with their

multicultural dimensions having certain implications for HRM. The implications of globalization for HRM are discussed subse-

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quently. The Indian economy has already become an open economy but it will be more so from April 2003 with the complete

lifting of quantitative restrictions (QRs) on imports in India.

Technology has become the hallmark of the modem organisations. As such, modem organisations have become the technology-

driven organisations. So to say, men are replaced by machinery. Manufacturing technology, for example, has changed to auto-

mation and robotisation.

Manufacturing advances like these will eliminate many blue-collar jobs, replacing them with fewer but more highly skilled jobs.

Similar changes are taking place in office automation, where personal computers, word processing, and management infor-

mation system (MIS) continue to change the nature of office work.

The explosive growth of information technology linked to the internet has ushered in many changes throughout the organisa-

tion. One of the major changes led by information technology is that it has hastened what experts call the “fall of hierarchy”,

i.e., managers depend less and less on yesterday’s “stick-to-the -chain-of-command approach,” to their organising function.

This is so because earlier it used to be, if one wanted information, one had to go up, over and down through the organisation.

Now, one just taps in. That’s what broke down the hierarchy. Somuchso, now employees do not need to be present a definite

work place.

Instead, they can work from their own places/ residences through the net. This has given genesis to a new breed of organisa-

tions, called ‘virtual organisations (VO).

3. Globalization: The New Economic Policy, 1991 has, among other things, globalised the Indian economy. There has been a

growing tendency among business firms to extend their sales or manufacturing to new markets aboard. The rate of globalization

in the past few years in India has been nothing short of phenomenal.

Globalization increases competition in the international business. Firms that formerly competed only with local firms, now have

to compete with foreign firms/competitors. Thus, the world has become a global market where competition is a two-way street.

Globalization has given genesis to the multinational corporations (MNCs). The MNCs are characterised by their cultural diversi-

ties, intensified competition, variations in business practices and so on. As an international business expert puts it, ‘the bottom

line is that the growing integration of the world economy into a single, huge market place is increasing the intensity of competi-

tion in a wide range of manufacturing and service industries.

Given these conditions, from tapping the global labour force to formulating selection, training and compensation policies for

expatriate employees have posed major challenges for HRM in the next few years. This has underlined the need for studying

and understanding HRM of multinational organisations or international organisations separately.

4. Organisational Restructuring: Organisational restructuring is used to make the organisation competitive. From this point of

view, mergers and acquisitions of firms have become common forms of restructuring to ensure organisational competitiveness.

The mega-mergers in the banking, telecommunications and petroleum companies have been very visible in our country. Down-

sizing is yet another form of organisational restructuring.

As a part of the organisational changes, many organisations have “right sized” themselves by various ways like eliminating layers

of managers, closing facilities, merging with other organisations, or out placing workers. There has been a practice to flatten or-

ganisations by removing several layers of management and to improve productivity, quality, and service while also reducing

costs. Whatever be the form of restructuring, jobs are redesigned and people affected.

One of the challenges that HRM faces with organisational restructuring is dealing with the human consequences of change. For

example, the human cost associated with downsizing has been much debated and discussed in the popular press. As such, HRM

needs to focus on the changed scenario uniquely and that is not so simple. Thus, management of HR activities has become cru-

cial for HR managers.

5. Changing Nature of Work: Along with changes in technology and globalization, the nature of jobs and work has also changed.

For example, technological changes like introduction of fax machines, information technology, and personal computers have al-

lowed companies to relocate operations to locations with lower wages. There is also a trend toward increased use of temporary

or part-time workers in organisations.

One most significant change in the nature of work is that it has changed from manual to mental/ knowledge work. In this con-

text, the management expert Peter Drucker’s views are worth citing. He said that the typical business will soon bear little re-

semblance to the typical manufacturing company of 30 years ago.

The typical business will be knowledge-based, an organisation composed largely of specialists who direct and discipline their

own performance through organized feedback from colleagues, customers, and headquarter. For this reason, it will be what he

calls an information-based organization.

As a result, the organizations are giving and will give growing emphasis on their human capital i.e., the knowledge, education,

training, skills, and expertise of employees, the expense of physical capital like equipment, machinery and physical plants This

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growing emphasis on education and human capital has, among other things, changed the nature of economy as service-oriented

economy.

In the changed economic scenario, jobs demand a certain level of expertise that is far beyond that required of most workers 20

or 30 years ago. This means that companies are relying more on employee’s creativity and skills, i.e., employee’s brain power.

As Fortune magazine has rightly said:

“Brain power ….has never before been so important for business. Every company depends increasingly on knowledge-patents,

processes, management skills, technologies, information about customers and suppliers, and old-fashioned experience. Added

together, this knowledge is intellectual capital”.

As such, the HR environment has changed. The challenge posed by changed environment is fostering intellectuals or human

capital needs managing these differently than those of previous generation. Here, Drucker puts that the centre of gravity in em-

ployment is moving fast from manual or clerical workers to knowledge workers, who resist the command and control model

that business took from the military 100 years ago. Now that the changing environment of HRM is delineated, we can conven-

iently present the new HR management practices in such changing environment.

Human Resource Planning: Objectives, Need, Importance and Levels

Objectives: The main objective of having human resource planning is to have an accurate number of employees required, with

matching skill requirements to accomplish organisational goals.

In other words, the objectives of human resource planning are to:

1. Ensure adequate supply of manpower as and when required.

2. Ensure proper use of existing human resources in the organisation.

3. Forecast future requirements of human resources with different levels of skills.

4. Assess surplus or shortage, if any, of human resources available over a specified period of time.

5. Anticipate the impact of technology on jobs and requirements for human resources.

6. Control the human resources already deployed in the organisation.

7. Provide lead time available to select and train the required additional human resource over a specified time period.

According to Sikula “the ultimate purpose/objective of human resource planning is to relate future human resources to future

enterprise need so as to maximise the future return on investment in human resources”.

planning in an enterprise:

1. Making assessment human resource requirements for future and making plans for recruitment and selection.

2. Assessing skill needs in future.

3. Determining training and development needs of the enterprise.

4. To assess the surplus or shortage of human resources and avoiding unnecessary dismissals.

5. To minimise imbalances caused due to non-availability of human resources of right kind, right number in right time and at the

right place.

6. Ensuring optimum use of existing human resources in the enterprise.

7. Keeping the enterprise ready to meet with the technological development and modernisation.

8. Controlling wage and salary costs.

9. Ensuring higher labour productivity.

10. Ensuring career planning of every employee of the enterprise and making succession programmes.

Need for and Importance of HRP: The need for human resource planning in organisation is realised for the following reasons:

1. Despite growing unemployment, there has been shortage of human resources with required skills, qualification and capabili-

ties to carry on works. Hence the need for human resource planning.

2 Large numbers of employees, who retire, die, leave organisations, or become incapacitated because of physical or mental ail-

ments, need to be replaced by the new employees. Human resource planning ensures smooth supply of workers without inter-

ruption.

3. Human resource planning is also essential in the face of marked rise in workforce turnover which is unavoidable and even

beneficial. Voluntary quits, discharges, marriages, promotions and seasonal fluctuations in business are the examples of factors

leading to workforce turnover in organisations. These cause constant ebb and flow in the work force in many organisations.

4. Technological changes and globalisation usher in change in the method of products and distribution of production and ser-

vices and in management techniques. These changes may also require a change in the skills of employees, as well as change in

the number of employees required. It is human resource planning that enables organisations to cope with such changes.

5. Human resource planning is also needed in order to meet the needs of expansion and diversification programmes of an or-

ganisation.

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6. The need for human resource planning is also felt in order to identify areas of surplus personnel or areas in which there is

shortage of personnel. Then, in case of surplus personnel, it can be redeployed in other areas of organisation. Conversely, in

case of shortage of personnel, it can be made good by downsizing the work force.

Human resource planning is important to organisation because it benefits the organisation in several ways.

Need

1. Replacement of Persons: A good number of employees are to be replaced in the undertaking because of retirement, old age,

death etc. So there will be a need to prepare and train persons for taking up vacant jobs in an enterprise.

2. Labour Turnover: Labour turnover takes place in all enterprises. However, the degree of labour turnover may vary from com-

pany to company but it cannot be eliminated altogether. There is always a need to recruit new employees to take up the jobs of

those who have left the undertaking.

If the undertaking is able to foresee turnover rate properly then efforts in advance are made to recruit and train employees so

that work does not suffer for want of employees.

3. Expansion Plans: Whenever there is a proposal to expand or diversify the enterprise, more employees will be needed to oc-

cupy new jobs. In such situations the human resource planning is necessary.

4. Technological Changes: With research and new inventions, technological changes are coming rapidly. There may be need to

give fresh training to personnel. In addition, there may also be a need to infuse fresh blood into the enterprise. Human resource

planning will be helpful in coping to the new demands of the enterprise.

5. Assessing Future Requirements: Human resource planning is also needed to assess whether there is any shortage or surplus

employees in the undertaking. If there is less number of employees than needed, it will badly affect the work. On the other

hand, if more persons are working than needed then it will increase labour costs, etc. Human resource planning ensures the

employment of right employees.

The important ones are mentioned below:

1. Human resource planning meets the organisation need for right type of people in right number at right times.

2. By maintaining a balance between demand for and supply of human resources, human resource planning makes optimum use

of human resources, on the one hand, and reduces labour cost substantially, on the other.

3. Careful consideration of likely future events, through human resource planning might lead to the discovery of better means

for managing human resources. Thus, foreseeable pitfalls might be avoided.

4. Manpower shortfalls and surpluses may be avoided, to a large extent.

5. Human resource planning helps the organisation create and develop training and succession planning for employees and

managers. Thus, it provides enough lead time for internal succession of employees to higher positions through promotions.

6. It also provides multiple gains to the employees by way of promotions, increase in emoluments and other perquisites and

fringe benefits.

7. Some of the problems of managing change may be foreseen and their consequences mitigated. Consultations with affected

groups and individuals can take place at an early stage in the change process. This may avoid resistance for change.

8. Human resource planning compels management to asses critically the strength and weaknesses of its employees and person-

nel policies on continuous basis and, in turn, take corrective measures to improve the situation.

9. Through human resource planning, duplication of efforts and conflict among efforts can be avoided, on the one hand, and

coordination of worker’s efforts can be improved, on the other.

10. Last but no means the least, with increase in skill, knowledge, potentialities, productivity and job satisfaction, organisation

becomes the main beneficiary. Organisation is benefitted in terms of increase in prosperity/production, growth, development,

profit and, thus, an edge over its competitors in the market.

Levels of Human Resource Planning: Human resource planning is useful at different levels.

At the National Level: Human resource planning by Government at the national level covers population projections, programme

of economic development, educational and health facilities, occupational distribution and growth, mobility of personnel across

industries and geographical regions.

At the Sector Level: This would cover manpower requirements of the agricultural sector, industrial sector and service sector.

At the Industry Level: This would forecast manpower need for specific industries, such as engineering, heavy industries, textile

industries, plantation industries, etc.

At the Level of Industrial Unit: It relates to the manpower needs of a particular enterprise.

Career Planning and Succession Planning - Principles of Human Resource Management

Career Planning Definitions:

1. A career may be defined as ‘a sequence of jobs that constitute what a person does for a living’.

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2. According to SCHERMERBORN, Hunt, and Osborn, ‘Career planning is a process of systematically matching career goals and

individual capabilities with opportunities for their fulfilment’.

3. Career planning is the process of enhancing an employee’s future value.

4. A career plan is an individual’s choice of occupation, organization and career path.

Career planning encourages individuals to explore and gather information, which enables them to synthesize, gain competen-

cies, make decisions, set goals and take action. It is a crucial phase of human resource development that helps the employees in

making strategy for work-life balance.

Features of Career Planning and Career Development:

1. It is an on-going process.

2. It helps individuals develop skills required to fulfil different

career roles.

3. It strengthens work-related activities in the organization.

4. It defines life, career, abilities, and interests of the em-

ployees.

5. It can also give professional directions, as they relate to ca-

reer goals.

Objectives of Career Planning:The major objectives of career planning are as follows:

1. To identify positive characteristics of the employees.

2. To develop awareness about each employee’s unique-

ness.

3. To respect feelings of other employees.

4. To attract talented employees to the organization.

5. To train employees towards team-building skills.

6. To create healthy ways of dealing with conflicts, emo-

tions, and stress.

Benefits of Career Planning:

1. Career planning ensures a constant supply of promotable employees.

2. It helps in improving the loyalty of employees.

3. Career planning encourages an employee’s growth and development.

4. It discourages the negative attitude of superiors who are interested in suppressing the growth of the subordinates.

5. It ensures that senior management knows about the calibre and capacity of the employees who can move upwards.

6. It can always create a team of employees prepared enough to meet any contingency.

7. Career planning reduces labour turnover.

8. Every organization prepares succession planning towards which career planning is the first step.

Key terms in career planning: Before we proceed further, a mention of the key terms commonly used in connection with career

planning seems pertinent.

Career Goal: - The future positions one strives to reach in his careen

Career Path: - The sequential and progressive path or line through which, one moves toward his/ her career goal.

Career Anchors: - These are the basic drives acquired by an individual during the socialisation process which urge him to take up

a career of a certain type.

Career Progression: - Making progress in one’s career through a series of right moves in the form of promotions.

Mentoring: - A process wherein a senior employee serves in an informal way as a teacher, guide, friend, philosopher and confi-

dante to the new employee in the organisation.

Career Planning: - This is the process by which an employee selects career goals and the path to these goals.

Career Development: - The personal improvements one undertakes to achieve a personal career plan.

Career Management: - This is the process of designing and implementing goals, plans and strategies to enable the organisation

to satisfy employee needs while allowing individuals to achieve their career goals.

Career Anchors: - Longitudinal researches conducted by the psychologists have indicated that during the socialisation process,

certain attitudinal syndromes are formed early in life. These syndromes are composed of a combination of needs, values, and

talents and serve to anchor the person to one or a few related type of careers throughout his life. Knowledge of these anchors

helps in planning career development.

This is precisely the reason why a person desires to be a doctor or engineer or administrator and alike in his/her life. In a sense,

just as boats put down anchors to keep them from drifting too far, individuals put down anchors to stabilise their career choices.

Five career anchors identified are:

1. Managerial Competence: - People having such anchors are characterised by an overriding interest in managerial positions

that offer opportunities for higher responsibility, decision making and control and influence.

2. Technical-functional competence: - People having a strong technical – functional career anchor seem to make career choices

based on their technical or functional knowledge of the work, such as engineering and accounting. They like to become ex-

perts/specialists rather than become general managers.

3. Security: - People driven by such career anchors like to ensure security of career through compliance with organisation’s pre-

scriptions.

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4. Creativity: - Such people are characterised by an overriding interest to do something new that could be identified as theirs.

Such people start a new venture, work in research lab and pilot some business venture. They choose a career less for making

money than identifying them by creating something new.

5. Autonomy-Independence: - People having such career anchors seek a career that provides freedom of action and independ-

ence. Freelance writers and consultants belong to this category.

Need for Career Planning: The need for career planning is felt to:

(i) Attract competent person and retain them in the organisation.

(ii) Provide suitable promotional opportunities.

(iii) Map out careers of employees suitable to their ability, and their willingness to be trained and developed for higher posi-

tions.

(iv) To ensure better utilization of managerial reserves within an organisation.

(v) Reduce employee dissatisfaction and turnover.

(vi) Improve employee morale and motivation by matching their skills to job requirements.

(vii) Provide guidance and encouragement employees need to fulfil their potentials.

(viii) Achieve higher productivity and organisation development.

Succession Planning:

Organisations run on eternal basis. The survival and thrive of any organisation on continuous basis requires a succession of per-

sons to fill key positions. This is done through “succession planning”. Succession planning can be defined as an executive inven-

tory report indicating what individuals are ready to move into higher positions in the organisation.

In an organisation, positions at higher levels fall vacant due to various reasons like retirement, resignation, promotion, transfer,

death, etc. Therefore, the very purpose of succession planning is to identify, groom, develop and make the people ready to oc-

cupy higher level jobs as and when they fall vacant.

Succession may be from both internal and external sources. Succession from internal sources is advantageous to the organisa-

tion as well as to the internal employees. This is so because while organisation can buy employees loyalty and commitment,

employees feel belongingness, and shared feelings of development along with the organisation.

In order to groom internal employees to assume higher responsibilities in future, some professionally run large organisations

ask their managers and supervisors to identify the internal employees having potentialities to replace them in jobs should the

need arise.

However, it is necessary to allow inflow of new blood also, i.e., succession through outside talent in certain cases like when

competent and qualified people are not available internally, when major expansion, diversification and growth plans are in of-

fing.

Experiences suggest that complete dependence on either internal or external sources is not advisable to any organisation. What

is often advisable in this regard is a judicial balance between the two sources should be maintained.

According to BISWAJEET PATTANAYAK, the succession planning involves the following eight core activities:

(i) Analysis of the demand for executives, managers and professionals by level, function and skill.

(ii) Audit of existing executives and inventory of likely future supply from both internal and external sources.

(iii) Planning individual career paths based on objective estimates of future needs and drawing on reliable appraisal and assess-

ment of potential.

(iv) Undertaking career counselling in the context of future requirements for executives and managers.

(v) Accelerated promotion schemes with development targeted against the future needs of the organisation.

(vi) Training and development activities to groom people for future roles.

(vii) Planned recruitment to fill short-term vacancies and provide people for development to meet future needs.

(viii) The actual process by which jobs are filled includes recruitment procedure, internal appointment procedure, methods of

assessment, internal search mechanism and often, use of computer-based information systems.

Successful Succession Planning For a Family Business (4 Steps)

We all know that sooner or later, every one retires from service, business or even from life. But retirement from business is not

just a matter of deciding not to go to office anymore. It is, in fact, much more than that. The paramount question that arises on

retirement from business is what happens to the business after one retires from the business.

Who is going to manage the business when one no longer works in the business? How will ownership be transferred? Will one

business carry on or will sell it? Business succession planning seeks to address and manage these vital issues involved in family

business by setting up a smooth transition between their owner-leader and the future one of the family business.

Let us begin with understanding the meaning of the term ‘succession planning.’ Some people term ‘succession planning’ as

‘multi-generational planning’ or ‘replacement is planning’. Be it called by any names, succession planning means planning for

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succession or making preparations on who will succeed the owner- leader of the business. Succession planning is a process for

identifying and developing family members with the potential to succeed the key role of owner- leader in the business. Accord-

ing to CHARAN, DROTTER and Noel (2001), succession planning is concerned with developing the second order owner-leader to

run the family business.

Following are some of the important steps involved in making a successful succession planning for a family business:

1. Make a Solid Case for Succession Planning: - Remember people do not resist changing, they resist to be changed. Therefore,

if one wants to influence family members’ opinions about business succession, he/she wants first to make a strong case for suc-

cession planning. Convince the family members, with real life examples, the need for and significance of having succession plan-

ning for ensuring the smooth and effective running of family business generation after generation.

Give the family members’ facts and figures like nearly 90 per cent of small enterprises are family-owned, but only 30 per cent of

them succeed into the second generation, while 15 per cent make it to the third generation, and only 3 per cent reach to the

fourth generation.

Thus, convince them that the lack of succession planning is to blame this sorry state of family business. The fact remains that

having a solid succession plan is like having a good insurance policy for the perpetual continuity of family business through gen-

erations. Educate and help family members understand the value of putting a succession plan into place well in time.

Here the views of JAMSHED J. IRANI expressed about introducing organizational change seem worth citing to appreciate the sig-

nificance of planning for succession well in ahead: “Change when you are still strong and when change appears unnecessary –

do not wait for the day when you have no option but to change.”

2. Prepare an Exit Plan: - Clarify in advance under what circumstances the succession plan will take effect: whether on retire-

ment or unplanned departure or changing financial situations. These questions help determine what the succession plan should

detail most. Keep in mind that both early-exit and late- exist of the owner-leader have advantages as well as disadvantages for

family business.

3. Identify the Successor: - Identifying the right successor is one of the most significant steps in succession planning. The busi-

ness successor should be identified by competence, not by any other considerations and compulsions. One way to do so is to

first identify the qualities or attributes a successor must possess to succeed the business. The family member who possesses the

maximum of so identified attributes should be selected for business succession.

4. Grooming and Developing the Successor: - Once a successor is identified, he/she needs to be groomed and developed to as-

sume the headship of the business. It can be done through various ways like giving on-the-job training, working under mentors

and advisors, and delegating some authority to the successor much before the actual passing on of the baton takes place. Of

course, grooming more than one member to become the successor of business is not a bad idea, but at times it may create con-

fusions and complexities leading to strenuous succession battles.

Business history is replete with evidences, like the recent one of AMBANI brothers, that extreme succession battle may cause a

split in the family business. Yes, some may not consider the split as a bad thing considering the fact that the split between Am-

bani brothers led to a dramatic increase in the value of their individual holdings in the erstwhile family business

Meaning of Career Planning - Career planning is the process by which one selects career goals and the path to these goals.

Career development is those personal improvements one undertakes to achieve a personal career plan.

Career management is the process of designing and implementing goals, plans and strategies to enable the organization to satisfy employee needs while allowing individuals to

achieve their career goals.

Need for Career Planning Career Planning is necessary due to the following reasons:

To attract competent persons and to retain them in the organization.

To provide suitable promotional opportunities.

To enable the employees to develop and take they ready to meet the future chal-

lenges.

To increase the utilization of managerial reserves within an organization.

LIFE STAGES & PROCESSES OF CAREER 4

Components of Career Planning

Process of Career Planning and Development

i. Analysis of individual skills, knowledge, abilities, aptitudes etc. ii. Analysis of career opportunities both within and outside the organization.

iii. Analysis of career demands on the incumbent in terms of skills, knowledge, abilities, aptitude etc., and in terms of qualifications, experience and training received etc.

iv. Relating specific jobs to different career opportunities.

v. Establishing realistic goals both short-term and long-term.

vi. Formulating career strategy covering areas of change and adjustment.

vii. Preparing and implementing action plan including acquiring resources for achieving goals.

Steps involved in Career Development System

Step 1: Needs: Defining the present system

Step 2: Vision: Determining New Directions and Possibilities

Step 3: Action Plan: Deciding on practical first steps

Step 4: Results: Maintaining the change

Pre-requisites for the success of career planning

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Strong commitment of the top management in career planning, succession planning and

development.

Organization should develop, expand and diversify its activities at a phased manner.

Organization should frame clear corporate goals.

Organization should have self-motivated, committed and hardworking employees.

Organization’s goal in selection should be selecting the most suitable man and place him in

the right job.

Organization should take care of the proper age composition in manpower planning and in

selection.

Organization should take steps to minimize career stress.

Organization should have fair promotion policy.

Organization should publicize widely the career planning and development programmes.

Advantages of Career Planning and Development For Individuals For organization

satisfies employee esteem needs

improves employee’s performance on the job

enhances employee commitment

Increases morale of an employee.

Ensures the availability of human resources with re-

quired skill, knowledge and talent.

Improve the organization’s ability to attract and retain

highly skilled employees.

satisfy the employee expectations

Protecting employees’ interest

Limitations of career planning

Dual Career Families Declining Career Opportunities Low ceiling careers Downsizing/Delayering and careers

Suggestions for effective career development

Challenging Initial Job Assignments

Dissemination of Career Option Information

Job Positioning

Assessment Centres

Career Counselling

Succession Planning

Succession may be from internal employees or external people.

Succession from internal employees is advantageous to the organization as well as to the internal employees.

Organization can buy the employees loyalty and commitment, belongingness, shared feeling of development along with the organization by promoting the internal employees.

Employees get the benefits of growth in the organization.

The organization mostly prefers to encourage the growth and development of its employees and as such tends to prefer succession from within.

Organizations, appraise employee’s potentialities, identify training gaps for future vacancies, and develop them for higher and varied jobs.

The scope of succession plan would be more when the organization grows steadily and employees have potentialities to take up higher responsibilities.

Need for Succession Planning

Key staff will need to be replaced To meet staff’s desire for new and challenging roles. To fill the skill and knowledge shortages

Work outputs and corporate objectives must continue to be met despite resignations, illness, vacations and restructuring.

Strategies

Natural Selection: Filling positions from those internal employees that are fittest or best or hiring from outside the organization if not enough people found within.

Acceleration pool: Investing in nurturing the skills of high potential staff through coaching, training, leadership positions and important work assignments.

Benefits Disadvantages

Enabling seamless transition

Back up staff

Having skills and knowledge for emergency situations

as well as future needs

Enhanced staff motivation

Reduced cost and time for training for replacement

Difficulty in selecting the right people and determin-

ing their developmental needs

Potential for grooming for positions that may not be

there in the future

Difficulties in maintaining the motivation levels

Possibility of poaching by other organizations

Inherent cost of training and mentoring

Best Practices Clarity of purpose and desired results of the program, and desired performance measures.

i. Effective follow up and review of the progress

ii. Documentation of competencies

iii. Rewards for both the mentor and the mentee

iv. Evaluate results – through availability of staff with key skills

v. CEO and leadership involvement in the process

7 keys steps to start effective career & succession planning

1. Assess the problem

2. Obtain executive buy-in and create a plan for success

3. Become more strategic

4. Strengthen your employee data

5. Integrate talent management functions

6. Consider integrated systems as part of the solution

7. Don’t just diagnose — prevent

1. Assess the problem - Once you take the time to give your organization an honest assessment, you can immediately determine

the severity of the talent pandemic in your organization. You should determine how rapidly turnover is increasing, replacement

costs, where your critical skill gaps are, and generally which parts of your organization are not delivering results. You should also

be able to track anecdotal evidence, such as stop-gap measures like interim skill positions or leaving key positions vacant for ex-

tended periods of time.

Once you identify the real issues to tackle, you can leverage the tools necessary to combat this threat.

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Obtain executive buy-in and create a plan for success - In our survey, executive buy-in was the primary reason for failure to im-

plement formal succession planning. A small proportion of respondents who said they did have a formal succession planning pro-

cess also faced this issue — although they were able to overcome it.

The best way to overcome executive resistance is to align strategic succession management with the business strategy. You have

more than enough data to support your case. When asked what keeps them up at night, most executives today will respond that

their top priority is managing talent assets to produce revenue and execute new strategies. What better way to ensure successful

asset management than to develop the skills and knowledge needed to proactively address the demands created by new busi-

ness strategies, and to develop the leadership required to initiate and sustain change? And by looking inward to the organiza-

tion’s existing talent pool before recruiting externally, HR can assure the CEO that existing assets are managed properly before

spending money on new talent.

Executive endorsement will help raise company-wide awareness of the talent pandemic, and help you implement powerful pro-

grams that hedge this risk. Next, you’ll be able to draft an implementation plan, define how processes are affected, and select the

technology needed to make this a success. One aspect of our survey results was a little troubling. While about half of respond-

ents said that they had a formal succession planning process in place, two-thirds of those same respondents felt only “somewhat

prepared” to cover potential exposures left by the departure of senior executives or other business-critical positions.

Considering the high turnover among younger employees, the impending retirement of large numbers of older employees, and

increasing competition for talent, these “somewhat prepared” organizations might be disasters waiting to happen. If they fail to

take a strategic approach to understanding their talent pool and building a talent pipeline, then they lack the resilience needed to

respond to departures as well as to business change.

Perhaps the respondents’ unpreparedness — despite their best efforts — stems from their largely tactical approach to succession

planning. The great majority of “somewhat prepared” respondents focused succession planning on senior manage-

ment/executives only, with the most common activities centered on naming successors, analyzing risk, and developing leaders.

Become more strategic - A more strategic approach would be to focus risk analysis and leadership development on non-executive

positions as well, particularly in two areas: technical and professional job categories where companies are increasingly short-

handed, and the business-critical positions that deliver the most strategic value to the organization.

Only about 10% of respondents’ succession planning activities focused on business-critical positions or job families. In addition,

this group of respondents was also more likely to use tactical approaches in these employee groups, such as enabling employees

to target specific jobs or career paths.

Not only are your employees your organization’s most costly expense item, they are increasingly becoming your competitive ad-

vantage. Thus, HR needs to become more strategic guardians of human capital. That means doing everything in your power to

match the right people to the right jobs, ensure key positions have succession plans, and decrease the rate of voluntary turno-

ver.

1. Strengthen your employee data - Strategic succession planning simply can’t happen without valid employee data, and our survey

confirms that. Half of respondents cited their inability to accurately measure employee performance, or a lack of up-to-date em-

ployee data, as a significant barrier to implementing succession planning.

The best way to fix this problem is to implement a sound, ongoing performance management process that gathers data consist-

ently, accurately, and universally. Recent enhancements in web-based technology make this easier than ever. With the right per-

formance management system, it becomes a relatively simple task to integrate performance results with other data for a com-

plete profile of each employee, including experience, certifications, compensation, aspirations, flight risk and other information

that is critical to making deployment decisions. The right performance management system can even be used by managers to as-

sess potential and calibrate ratings.

Other data you’ll need to start obtaining include:

Internal voluntary turnover rates

Industry benchmarks on company

turnover

Internal/External fill ratios

Termination costs

Replacement costs

On boarding costs

Reasons people are leaving the organi-

zation

Once you have logged these figures and your organization’s performance management process, you’ll be able to identify and ad-

dress both costs and underlying reasons.

What about aggregate level employee data? Respondents to our survey who have a formal succession planning process tended

to review their talent pipeline regularly, while those without a formal process were more likely to say they rarely review their tal-

ent pipeline. A comprehensive talent inventory integrates data from multiple sources to identify skills gaps at a departmental

level as well as the individual level — and systematically identifies people with qualifications needed to fill those gaps.

1. Integrate talent management functions - Career and succession planning activities cannot occur in a vacuum. As you can see

from the various data points compiled in our survey, aligning activities will require working among groups that are highly segre-

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gated in many organizations. Talent Management is composed of talent acquisition, learning management, employee perfor-

mance management, and compensation management. Effective career and succession planning draws from each of these areas.

Everybody wins when your systems integrate well and your organization is aligned to share data across functions.

1. Consider integrated systems as part of the solution - While technology alone cannot decrease the costs of employee turnover or

fill talent gaps, recent developments in talent management technology can enable organizations to address the threats of talent

shortages. Since low-cost solutions now provide better snapshots of information and save immense amounts of time, companies

can effectively address issues in their career and succession planning processes.

Your organization will also need to be prepared to build new processes to manage such risks, and provide resources to oversee

career and succession planning activities on an on-going basis. Integrated talent management technology can help accomplish

this in a variety of ways. For example, the technology itself will provide your organization better access to data, quicker pro-

cessing of information, and easier alignment among groups.

1. Don’t just diagnose — prevent - Performance management and succession planning are constant, year-round processes. Your

process changes will make a significant impact on your organization, but you’ll impact a lot of groups in doing so. Succession

snapshots will constantly change and you’ll need to communicate those changes across the organization. Communication is crit-

ical. You’ll need to constantly update the groups who can mitigate the key risks and enforce positive change. This can include

the learning and development, recruiting, and compensation groups. Even the employees themselves will be an integral part of

reducing the risks of talent shortages. After all, if you’re looking to reduce the rate of voluntary turnover and implement key

succession strategies—you’ll need everyone’s help.

Job Analysis and Job Description In simple terms, job analysis may be understood as a process of collecting information about a job. The process of job analysis results in two sets of data: i) Job description and ii) Job specification. These data are recorded separately for references. Let us summarise the concept of Job Analysis: A few definitions on job analysis are quoted below 1. Job analysis is the process of studying and collecting information relating to the operations and responsibilities of a specific job. The immediate products of this analysis are job descriptions and job specifications. 2. Job analysis is a systematic exploration of the activities within a job. It is a basic technical procedure, one that is used to de-fine the duties, responsibilities and accountabilities of a job. 3. A job is a collection of tasks that can be performed by a single employee to contribute to the production of some products or service provided by the organization. Each job has certain ability recruitments (as well as certain rewards) associated with it. Job analysis is the process used to identity these requirements. Specifically, job analysis involves the following steps: 1. Collecting and recording job information 2. Checking the job information for accuracy. 3. Writing job description based on the information

4. Using the information to determine the skills, abilities and knowledge that are required on the job. 5. Updating the information from time to time.

Job Analysis, A process of obtaining all pertaining job facts is classified into two i.e. Job Description and Job specification Job Description is an important document, which is basically descriptive in nature and contains a statement of job Analysis. It provides both organizational information’s (like location in structure, authority etc) and functional information. It gives infor-mation about the scope of job activities, major responsibilities and positioning of the job in the organization. This information gives the worker, analyst, and supervisor with a clear idea of what the worker must do to meet the demand of the job. Who can better describe the characteristics of good job description? Earnest Dale has developed the following hints for writing a good job description: – 1) The job description should indicate the scope and nature of the work including all-important relationships. 2) The job description should be clear regarding the work of the position, duties etc. 3) More specific words should be selected to show:- a) The kind of work b) The degree of complexity c) The degree of skill required

d) The extent to which problems are standardized e) The extent of worker’s responsibility for each phase of the work

So we can conclude by saying that Job description provides the information about the type of job and not jobholders. USES OF JOB DESCRIPTION: – Now we will see why job description is necessary in an organization, There are several uses of job description, like • Preliminary drafts can be used as a basis for productive group discussion, particularly if the process starts at the executive lev-el. • It helps in the development of job specification. • It acts as a too during the orientation of new employees, to learn duties & responsibilities. It can act as a basic document used in developing performance standards.

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Contents of Job Description:

Following are the main content of a job description it usually consist of following details or data., Job Description: A statement containing items such as • Job title / Job identification / organiza-tion position • Location • Job summary

• Duties • Machines, tools and equipment • Materials and forms used • Supervision given or received

• Working conditions • Hazards

Job identification or Organization Position: – This includes the job title, alternative title, department, division and plant and code number of the job. The job title identifies and designates the job properly. The department, division etc., indicate the name of the department where it is situated and the location give the name of the place. Job Summary: – This serves two important purposes. First is it gives additional identification information when a job title is not adequate; and secondly it gives a summary about that particular job. Job duties and responsibilities: – This gives a total listing of duties together with some indication of the frequency of occurrence or percentage of time devoted to each major duty. These two are regarded as the “Hear of the Job”. Relation to other jobs: – This gives the particular person to locate job in the organization by indicating the job immediately be-low or above in the job hierarchy. Supervision: – This will give an idea the number of person to be supervised along with their job titles and the extent of supervi-sion. Machine: – These will also give information about the tool, machines and equipment to be used. Working Conditions: – It gives us information about the environment in which a jobholder must work. Hazards: – It gives us the nature of risks of life and limb, their possibilities of occurrence etc. Job Specification: - Job Specification translates the job description into terms of the human qualifications, which are required for performance of a job. They are intended to serve as a guide in hiring and job evaluation. Job specification is a written statement of qualifications, traits, physical and mental characteristics that an individual must possess to perform the job duties and discharge responsibilities effectively. In this, job specification usually developed with the co-operation of personnel department and various supervisors in the whole organization. Job Specification Information: – The first step in the programme of job specification is to prepare a list of all jobs in the compa-ny and where they are located. The second step is to secure and write up information about each of the jobs in a company. Usually, this information about each of the jobs in a company. Usually this information includes: 1. Physical specifications: – Physical specifications include the physical qualifications or physical capacities that vary from job to job. Physical qualifications or capacities 2. Include physical features like height, weight, chest, vision, hearing, ability to lift weight, ability to carry weight, health, age, capacity to use or operate machines, tools, equipment etc. 3. Mental specifications: – Mental specifications include ability to perform, arithmetical calculations, to interpret data, infor-mation blue prints, to read electrical circuits, ability to plan, reading abilities, scientific abilities, judgment, ability to concentrate, ability to handle variable factors, general intelligence, memory etc. 4. Emotional and social specifications: – Emotional and social specifications are more important for the post of managers, su-pervisors, foremen etc. These include emotional stability, flexibility, social adaptability in human relationships, personal appear-ance including dress, posture etc. 5. Behavioral Specifications: – Behavioural specifications play an important role in selecting the candidates for higher-level jobs in the organizational hierarchy. This specification seeks to describe the acts of managers rather than the traits that cause the acts. These specifications include judgments, research, creativity, teaching ability, maturity trial of conciliation, self-reliance, dominance etc. Employee Specification: – Job specifications information must be converted into employee specification information in order to know what kind of person is needed to fill a job. Employee specification is a like a brand name which spells that the candidate with a particular employee specification generally possess the qualities specified under job specification. Employee specification is useful to find out the suitability of particular class of candidates to a particular job. Thus, employee specification is useful to find out prospective employees (target group) whereas job specification is useful to select the right candidate for a job. Uses of job specification: – Uses of this job specification; • Physical characteristics, which include health, strength, age range, body size, weight, vision, poise etc. • Psychological characteristics or special aptitudes:- This include such qualities as manual dexterity, mechanical aptitude, inge-nuity, judgment etc. • Personal characteristics or fruits of temperament – such as personal appearance, good and pleasing manners, emotional sta-bility, aggressiveness or submissiveness. • Responsibilities: – Which include supervision of others, responsibility for production, process and equipment, responsibility for the safety of others and responsibility for preventing monetary loss. • Other features of a demographic nature: Which are age, sex, education, experience and language ability.

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• Job specifications are mostly based on the educated gneisses of supervisors and personnel managers. They give their opinion as to who do they think should be considered for a job in terms of education, intelligence, training etc. • Job specifications may also be based on statistical analysis. This is done to determine the relationship between Job Analysis: Concept, Uses and Process of Job Analysis

Concepts: Before we proceed to explain the concept of job analysis, let us first understand the meaning of the term ‘job’ itself

Job: In simple words, a job may be understood as a division of total work into packages/positions. According to Dale Yoder ‘, “A

job is a collection or aggregation of tasks, duties and responsibilities which as a whole, is regarded as a regular assignment to in-

dividual employees and which is different from other assignments”. Thus, a job may be defined as a group of positions involving

some duties, responsibilities, knowledge and skills.

Each job has a definite title based on standard trade specialisations within a job. Each job is different from other jobs like peon,

clerk, supervisor, and accountant, manager, etc. A job may include many positions. A position is a particular set of duties and re-

sponsibilities regularly assigned to an individual.

Job Analysis: Job analysis refers to the process of collecting information about a job. In other words, it refers to the anatomy of

the job. Job analysis is performed upon on-going jobs only. It contains job contents. For example, what are the duties of a su-

pervisor, grade II, what minimal knowledge, skills and abilities are necessary to be able to adequately perform this job? How do

the requirements for a supervisor, grade II, compare with those for a supervisor, grade I? These are the questions that job anal-

ysis answers.

Let us consider a few important definitions of job analysis.

According to JONES AND DECOTHIS “Job analysis is the process of getting information about jobs: specially, what the worker

does; how he gets it done; why he does it; skill, education and training required; relationship to other jobs, physical demands;

environmental conditions”.

EDWIN B. FLIPPO has defined job analysis as the process of studying and collecting information relating to the operations and

responsibilities of a specific job. The immediate products of this analysis are job descriptions and job specifications”.

In the opinion of HERBERT G. HEREMAN III, et. al., “A job is a collection of tasks that can be performed by a single employee to

contribute to the production of some product or service provided by the organisation. Each job has certain ability require-

ments (as well as certain rewards) associated with it. Job analysis is the process used to identify these requirements”. Now, job

analysis can be defined as an assessment that describes jobs and the behaviours necessary to perform them.

There are two major aspects of job analysis:

These are:

1. Job Description 2. Job Specification

Job Description: - Job description is prepared on the basis of data collected through job analysis. Job description is a functional

description of the contents what the job entails. It is a narration of the contents of a job. It is a description of the activities and

duties to be performed in a job, the relationship of the job with other jobs, the equipment and tools involved, the nature of su-

pervision, working conditions and hazards of the job and so on.

All major categories of jobs need to be spelled out in clear and comprehensive manner to determine the qualifications and

skills required to perform a job. Thus, job description differentiates one job from the other. In sum, job description is a written

statement of what a job holder does, how it is done, and why it is done.

Purposes of Job Description:

Job description is done for fulfilling the following purposes:

1. Grading and classification of jobs

2. Placement and Orientation of new

employees

3. Promotions and transfers

4. Outlining for career path

5. Developing work standards

6. Counselling of employees

7. Delimitation of authority

Job Specification: - While job description focuses on the job, job specification focuses on the person i.e, the job holder. Job

specification is a statement of the minimum levels of qualifications, skills, physical and other abilities, experience, judgment and

attributes required for performing job effectively. In other words, it is a statement of the minimum acceptable qualifications

that an incumbent must possess to perform a given job. It sets forth the knowledge, skills and abilities required to do the job ef-

fectively.

Job specification specifies the physical, psychological, personal, social and behavioural characteristics of the job holders. These

contents of the job specification are contained in Table 5.1.

Usages of Job Specification: The usages of job specification include:

1. Personnel planning

2. Performance appraisal

3. Hiring

4. Training and development

5. Job evaluation and compensation

6. Health and safety

7. Employee discipline

8. Work scheduling

9. Career planning

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Job Evaluation: - Job evaluation is a comparative

process of establishing the value of different jobs

in a hierarchical order. It allows one to compare

jobs by using common criteria to define the rela-

tionship of one job to another. This serves as basis

for grading different jobs and developing a suita-

ble pay structure for them.

It is important to mention that job evaluation

cannot be the sole determining factor for deciding

pay structures because job evaluation is about

relationships, and not absolutes. The techniques

used for job evaluation include ranking, job classi-

fication, points rating, etc.

Why job analysis? (Uses):

Job analysis is useful for overall management of all personnel activities.

The same is specified as follows:

1. Human Resource Planning: - The estimates the quantity and quality of people will be required in future. How many and what

type of people will be required depends on the jobs to be staffed. Job-related information available through job analysis is,

therefore, necessary for human resource planning.

2. Recruitment and Selection: - Recruitment succeeds job analysis. Basically, the goal of the human resource planning is to

match the right people with the right job. This is possible only after having adequate information about the jobs that need to be

staffed. It is job analysis that provides job information. Thus, job analysis serves as basis for recruitment and selection of em-

ployees in the organisation.

3. Training and Development: - Job analysis by providing information about what a job entails i.e., knowledge and skills re-

quired to perform a job, enables the management to design the training and development programmes to acquire these job re-

quirements. Employee development programmes like job enlargement, job enrichment, job rotation, etc.

4. Placement and Orientation: - As job analysis provides information about what skills and qualities are required to do a job, the

management can gear orientation programmes towards helping the employees learn the required skills and qualities. It, thus,

helps management place an employee on the job best suited to him/her.

5. Job Evaluation: - The job evaluation refers to determination of relative worth of different jobs. It, thus, helps in developing

appropriate wage and salary structures. Relative worth is determined mainly on the basis of information provided by job analy-

sis.

6. Performance Appraisal: - Performance appraisal involves comparing the actual performance of an employee with the stand-

ard one, i.e., what is expected of him/her. Such appraisal or assessment serves as basis for awarding promotions, effecting

transfers, or assessing training needs. Job analysis helps in establishing job standards which may be compared with the actual

performance/contribution of each employee.

7. Personnel Information: - Increasing number of organisations maintain computerised information about their employees. This

is popularly known as Human Resource Information System (HRIS). HRIS is useful as it helps improve administrative efficiency

and provides decision support^ Information relating to human resources working in the organisation is provided by job analysis

only.

8. Health and Safety: - Job analysis helps in identifying and uncovering hazardous conditions and unhealthy environmental fac-

tors such as heat, noise, fumes, dust, etc. and, thus, facilitates management to take corrective measures to minimise and avoid

the possibility of accidents causing human injury

Process of job analysis: Job analysis is as useful is not so easy to make. In fact, it involves a process.

Though there is no fool-proof process of making job analysis, following are the main steps involved in job analysis:

1. Organisational Job Analysis: - Job analysis begins with obtaining pertinent information about a job’. This, according to Terry is

required to know the makeup of a job, its relation to other jobs, and its contribution to performance of the organisation.

Such information can be had by dividing background information in various forms such as organisation charts i.e., how the par-

ticular job is related to other jobs; class specifications i.e., the general requirement of the job family; job description i.e., starting

point to build the revised job description, and flow charts i.e., flow of activities involved in a particular job.

2. Selecting Representative Jobs for Analysis: - Analysing all jobs of an organisation is both costly and time consuming. There-

fore, only a representative sample of jobs is selected for the purpose of detailed analysis.

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3. Collection of Data for Job Analysis: - In this step, job data features of the job and re-

quired qualifications of the employee are collected. Data can be collected either through

questionnaire, observation or interviews. However, due care should be taken to select

and use the method of data collection that is the most reliable in the given situation of

the job.

4. Preparing Job Description: - The job information collected in the above ways is now

used to prepare a job description. Job description is a written statement that describes

the tasks, duties and responsibilities that need to be discharged for effective job perfor-

mance.

5. Preparing Job Specification: - The last step involved in job analysis is to prepare job

specification on the basis of collected information. This is a written statement that speci-

fies the personal qualities, traits, skills, qualification, aptitude etc. required to effectively

perform a job.

Manpower Planning

Manpower Planning which is also called as Human Resource Planning consists of putting right number of people, right kind of

people at the right place, right time, doing the right things for which they are suited for the achievement of goals of the organi-

zation. Human Resource Planning has got an important place in the arena of industrialization. Human Resource Planning has to

be a systems approach and is carried out in a set procedure. The procedure is as follows:

1. Analysing the current manpower inventory

2. Making future manpower forecasts

3. Developing employment programmes

4. Design training programmes

Steps in Manpower Planning

1. Analysing the current manpower inventory- Before a manager makes forecast of future manpower, the current manpower

status has to be analysed. For this the following things have to be noted-

Type of organization

Number of departments

Number and quantity of such departments

Employees in these work units

Once these factors are registered by a manager, he goes for the future forecasting.

2. Making future manpower forecasts- Once the factors affecting the future manpower forecasts are known, planning can be

done for the future manpower requirements in several work units.

The Manpower forecasting techniques commonly employed by the organizations are as follows:

Expert Forecasts: This includes informal decisions, formal expert surveys and Delphi technique.

Trend Analysis: Manpower needs can be projected through extrapolation (projecting past trends), indexation (using base year

as basis), and statistical analysis (central tendency measure).

Work Load Analysis: It is dependent upon the nature of work load in a department, in a branch or in a division.

Work Force Analysis: Whenever production and time period has to be analysed, due allowances have to be made for getting

net manpower requirements.

Other methods: Several Mathematical models, with the aid of computers are used to forecast manpower needs, like budget

and planning analysis, regression, and new venture analysis.

3. Developing employment programmes- Once the current inventory is compared with future forecasts, the employment pro-

grammes can be framed and developed accordingly, which will include recruitment, selection procedures and placement

plans.

4. Design training programmes- These will be based upon extent of diversification, expansion plans, development programmes,

etc. Training programmes depend upon the extent of improvement in technology and advancement to take place. It is also

done to improve upon the skills, capabilities, knowledge of the workers.

Importance of Manpower Planning

1. Key to managerial functions- The four managerial functions, i.e., planning, organizing, directing and controlling are based up-

on the manpower. Human resources help in the implementation of all these managerial activities. Therefore, staffing becomes

a key to all managerial functions.

2. Efficient utilization- Efficient management of personnels becomes an important function in the industrialization world of to-

day. Seting of large scale enterprises require management of large scale manpower. It can be effectively done through staffing

function.

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3. Motivation- Staffing function not only includes putting right men on right job, but it also comprises of motivational pro-

grammes, i.e., incentive plans to be framed for further participation and employment of employees in a concern. Therefore, all

types of incentive plans becomes an integral part of staffing function.

4. Better human relations- A concern can stabilize itself if human relations develop and are strong. Human relations become

strong trough effective control, clear communication, effective supervision and leadership in a concern. Staffing function also

looks after training and development of the work force which leads to co-operation and better human relations.

5. Higher productivity- Productivity level increases when resources are utilized in best possible manner. Higher productivity is a

result of minimum wastage of time, money, efforts and energies. This is possible through the staffing and its related activities

Need of Manpower Planning - Manpower Planning is a two-phased process because manpower planning not only analyses the

current human resources but also makes manpower forecasts and thereby draw employment programmes. Manpower Planning

is advantageous to firm in following manner:

1. Shortages and surpluses can be identified so that quick action can be taken wherever required.

2. All the recruitment and selection programmes are based on manpower planning.

3. It also helps to reduce the labour cost as excess staff can be identified and thereby overstaffing can be avoided.

4. It also helps to identify the available talents in a concern and accordingly training programmes can be chalked out to develop

those talents.

5. It helps in growth and diversification of business. Through manpower planning, human resources can be readily available and

they can be utilized in best manner.

6. It helps the organization to realize the importance of manpower management which ultimately helps in the stability of a con-

cern.

Methods of Assigning Manpower

Assigning manpower is also called planning manpower and planning human resource needs. Human resource planning is simply

the process of systematically looking at manpower needs to ensure that the required number of employees, with the appropri-

ate skills, are available when they are needed. Even a small business may benefit from a working method of assigning manpow-

er needs.

Mathematical Model - Mathematical models of human resource planning work well for sales-driven businesses. The number of

sales determines the number of hires. In order to run an efficient business, there must be a positive relationship between the

number of employees and sales demand. Small retail businesses know ahead of time that they will have a larger than usual sales

demand at the end of the calendar year, so they often plan to hire temporary employees during that time.

Estimation – Once you know how much manpower you need for a specific project, it becomes easier to estimate manpower

needs on other projects. Contractors who hire on a per-project basis must be able to take into account both the needs of the

job and the skill level of his employees. This knowledge allows the business owner to make an accurate estimation of manpower

needed for the job.

Strategic Planning - With strategic planning, business owners look at both the needs of the business as well as the specific skills

that different employees bring to the workplace. The key is to schedule workers so that people are at work when their skills are

needed. This is not as easy as it sounds, especially for a small business with few employees. Instead of hiring more workers,

which may not be possible, those who use strategic planning methods for assigning manpower often find that multiskilled

workers are the most valuable, and therefore may invest in additional training. At the same time, a good strategic boss will not

overschedule an individual employee; that could lead to burnout and the loss of the employee.

Human Resource Management - Companies that use human resource planning methods must have strong management. Man-

agement makes the schedule and employees must comply. In some businesses, such as restaurants, employees with the same

skill sets may work each other's shifts with the manager's permission. The manager, in this case, needs a specific number of

people with the necessary skills to work at any given time.

Selection: Meaning and Steps Involved in Selection Procedure

Selection: - Finding the interested candidates who have submitted their profiles for a particular job is the process of recruit-

ment, and choosing the best and most suitable candidates among them is the process of selection. It results in elimination of

unsuitable candidates. It follows scientific techniques for the appropriate choice of a person for the job.

The recruitment process has a wide coverage as it collects the applications of interested candidates, whereas the selection pro-

cess narrows down the scope and becomes specific when it selects the suitable candidates.

Stone defines, ‘Selection is the process of differentiating between applicants in order to identify (and hire) those with a greater

likelihood of success in a job’.

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Steps Involved in Selection Procedure: - A scientific and logical selection procedure leads to scientific selection of candidates.

The criterion finalized for selecting a candidate for a particular job varies from company to company.

Therefore, the selection procedure followed by different organizations, many times, becomes lengthy as it is a question of get-

ting the most suitable candidates for which various tests are to be done and interviews to be taken. The procedure for selection

should be systematic so that it does not leave any scope for confusions and doubts about the choice of the selected candidate

Brief details of the various steps in selection procedure are given as follows:

1. Inviting applications: - The prospective candidates from within the organization or outside the organization are

called for applying for the post. Detailed job description and job specification are provided in the advertisement for

the job. It attracts a large number of candidates from vari¬ous areas.

2. Receiving applications: - Detailed applications are collected from the candidates which provide the necessary in-

formation about personal and professional details of a person. These applications facilitate analysis and comparison

of the candidates.

3. Scrutiny of applications: - As the limit of the period within which the company is supposed to receive applications

ends, the applications are sorted out. Incomplete applications get rejected; applicants with un-matching job specifi-

cations are also rejected.

4. Written tests: - As the final list of candidates becomes ready after the scrutiny of applications, the written test is

conducted. This test is conducted for understanding the technical knowledge, atti¬tude and interest of the candi-

dates. This process is useful when the number of applicants is large.

Many times, a second chance is given to candidates to prove themselves by conducting another written test.

5. Psychological tests: - These tests are conducted individually and they help for finding out the indi¬vidual quality

and skill of a person. The types of psychological tests are aptitude test, intelligence test, synthetic test and personali-

ty test

6. Personal interview: - Candidates proving themselves successful through tests are interviewed per¬sonally. The in-

terviewers may be individual or a panel. It generally involves officers from the top management.

The candidates are asked several questions about their experience on another job, their family background, their in-

terests, etc. They are supposed to describe their expectations from the said job. Their strengths and weaknesses are

identified and noted by the interviewers which help them to take the final decision of selection.

7. Reference check: - Generally, at least two references are asked for by the company from the can¬didate. Refer-

ence check is a type of crosscheck for the information provided by the candidate through their application form and

during the interviews.

8. Medical examination: - Physical strength and fitness of a candidate is must before they takes up the job. In-spite of

good performance in tests and interviews, candidates can be rejected on the basis of their ill health.

9. Final selection: - At this step, the candidate is given the appointment letter to join the organization on a particular

date. The appointment letter specifies the post, title, salary and terms of employment. Generally, initial appointment

is on probation and after specific time period it becomes permanent.

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10. Placement: - This is a final step. A suitable job is allocated to the appointed candidate so that they can get the

whole idea about the nature of the job. They can get adjusted to the job and perform well in future with all capacities

and strengths.

Induction and socialization

Introduction - Induction also called orientation, and it is design to provide a new employee with information which he or she

needs to function’s comfortably and effectively in the organization.

When a new employee joins an organization, he is completely a stranger to the people, work place and the work environment.

Therefore, he is likely to feel insecure, shy and nervous. In the absence of information and support there is likely to be anxiety

and fear in his mind. He may undergo reality shock caused by a gap between his expectations and the real situation.

Meaning - Induction or orientation can help overcome these problems. Once an employee is selected and placed on an appro-

priate job, the process of familiarizing him with the job and organization begins. This process is called induction.

Induction is “the process of receiving and welcoming an employee when he first join a company and giving him the basic in-

formation he needs to settle down quickly and happily and start work”.

The new employee is introduced to the job and the organization. The purpose of orientation is to make the new entrant feel at

home and develop a sense of pride in the organization and commitment to the job. The new comer is explained his duties and

responsibilities, company policies and rules, and other relevant information to get acquainted and accommodated with the or-

ganization. “Induction is a planned introduction of employees to their jobs, their co-worker’s and the organization”.

Induction conveys three types of information: -

General information about the daily work routine.

A review of the organization’s history, founding further objectives, operations-product and employee contribution.

A detailed presentation in broacher’s of the organization and policies, work rules and employee benefits.

Objectives of induction

o To help the new comer overcome his natural shyness and nervous in meeting new people in a new environment.

o The idea is to make the new people feel at home.

o Coordination will developed with co-workers.

o Make good relationship, good initial impression of a company, work supervision.

o To build up the new employee’s confidence in the organization and in himself so that he may become an efficient employee.

o To give the new comer necessary information such as location of cafeteria, toilets and locker room, rest periods and leave

rules etc.

Advantages of formal induction

o Induction helps to build up a two-way channel of communication between management and workers.

o Proper induction facilities informal relations and teamwork among employees.

o Effective induction helps to integrate the new employee into the organization and to develop a sense of belonging.

o Induction is helpful in supplying information concerning the organization, the job and employee welfare facilities.

o A formal induction programme proves that the company is taking sincere interest is getting him off to a good start.

Contents of induction programme

1. Brief history and operations of the company.

2. Products and services of the company.

3. The company organization structure.

4. Location of department and employee facilities.

5. Policies and procedure of the company.

6. Rules, regulations and daily work routines.

7. Grievance procedure.

8. Safety measure.

9. Standing order and disciplinary procedure.

10. Terms and conditions of the service including wages,

working hours, overtime holidays etc.

11. Suggestion schemes.

12. Benefits and services of employees.

13. Opportunities for training, promotion and transfer.

How to make induction effective

1. Make the new employee aware of the general company policies that apply to him as well as the specific work situation and

requirements.

2. Determine how to present information.

3. Completion of paper work.

4. Answer any questions and clarify any doubt that the employee may have about the job and the organization.

5. Provide on-the-job instructions and counselling.

6. Keep in close touch with new employee to check back how he is doing and offer help if required.

21 BAJRANG/KUCHAMAN/BL7665843205@OUTLOOK.COM/MBA/NOTES/HUMAN-RESOURCE/MANAGEMENT

7. Allow reasonable time to adapt to the new work environment and job demands.

Evaluation of induction programme - This programme will be evaluated from the feedback through questionnaire, follow-up in-

terview, group discussion, that could help them to improve their performance.

Problems of orientation - An induction programme can go wrong for a number of reasons. The human resource department

should try to avoid such error’s come of them there: -

1. Supervisor who is not trained.

2. Employee is overloaded with two much information in short time.

3. Employee’s mistakes can damage the company.

4. Employee may develop wrong perception’s because of short-time periods spent on each job.

Placement - After an employee has been hired and oriented, he or she must be placed in the right job. Placement is understood

as the allocation of people to jobs. It is the assignment or reassignment of an employee to a new job. Placement include initial

assignment of new employee promotion, transfer or demotion of present employees.

When a candidate has been selected it is logical that he or she is placed in the position that was advertised earlier.

Socialization - It is the process of adaptation. It is the process by which new employees attempt to learn and inculcate the

norms and values of work roles in an organization. Learning and inculcating the norms and values of work group are necessary

for proper adjustment and job performance.

1. Socialization is based on several assumptions

2. New employee suffers from anxiety and require adjustment.

3. Socialization strongly affects employee programme and stability of organization.

Pre arrival stage - It recognizes that all the new recruits arrive in the organization with a set of values, norms, expectations and

learning. This includes both the work to be done and the organization. For example in a business schools, student acquire cer-

tain idea’s regarding the nature of their future jobs, pay packages, and carrier progress. At the recruitment stage many organiza-

tions give job preview which helps the prospective employees to learn more about the job and the organization.

Encounter stage - When the new employees join the organization, he encounter the realities of the situation in term of his job,

work culture, subordinates and peer’s. if the expectations of the individual are in the tune with the organizational realities, he

adapt organization quickly. On the other hand, if there is a marked difference between expectations and realities, socialization is

essential to replace his previous assumptions with realities. At the other extreme, the individual cannot recognize with the val-

ues and norms of the organization and quits the job.

Metamorphosis stage - In this stage, the new employee acquire the skills require to adjust with the values and norms of the or-

ganization. He brings necessary change in his attitude and role behaviour to suit the organization’s culture. Such changes make

the employee self-confident and he feels accepted by other members of the organization. The completion of socialization pro-

cess is characterized by fillings.

What is Socialization?

A. Socialization - In order to reduce the anxiety that new employees may experience, attempts should be made to integrate

the person into the informal organization. The initial T&D effort designed for employees is Socialization, the guided adjustment

of new employees to the company, the job, and the work group.

I. Purposes of Socialization - Socialization formats are unique to each firm. However, some basic purposes include emphasizing

these areas: the employment situation (job, department, and company), company policies and rules, compensation

and benefits, corporate culture, team membership, employee development, dealing with change, and socialization.

a. The Employment Situation - A basic purpose, from the firm’s viewpoint, is to have the new employee become productive as

quickly as possible. Therefore, specific information about performing the job may be provided at an early point in time.

b. Company Policies and Rules - Every job within an organization must be performed considering the guidelines and constraints

provided by policies and rules. Employees must have an understanding of these to permit a smooth transition to the workplace.

c. Compensation and Benefits - Employees will have a special interest in obtaining information about the reward system. Alt-

hough this information is usually provided during the recruitment and selection process, a review of the data is appropriate dur-

ing Socialization.

d. Corporate Culture - The firm’s culture reflects, in effect, how we do things around here. This relates to everything from the

way employees dress to the way they talk.

e. Team Membership - A new employee’s ability and willingness to work in teams is most likely determined before he or she is

hired. In Socialization, the importance of becoming a valued member of the company team may be emphasized.

f. Employee Development - Employees should know exactly what is expected of them and what is required by the firm for ad-

vancement in the job or via promotion.

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g. Dealing With Change - Employees at all levels must learn to effectively deal with change in order to survive in their jobs. The

best way individuals can be prepared for change is to continually develop and expand their skills.

h. Socialization - In order to reduce the anxiety that new employees may experience, attempts should be made to integrate the

person into the informal organization.

II. Stages in socialization Process:- Socialization can be conceptualized as a process made up of three stages.

a. Pre-arrival Stage: - This stage explicitly recognizes that each individual arrives with a set of organizational values, attitudes,

and expectations. For instance, in many jobs, particularly high skilled and managerial jobs, new members will have undergone a

considerable degree of prior socialization in training and in school. Pre-arrival socialization, however, goes beyond the specific

job. The selection process is used in most organizations to inform perspective employees about the organization as whole. In

addition, of course, interviews in the selection process also act to ensure the inclusion of the “right type” determining those

who will fit in. Indeed, the ability of the individuals to present the appropriate face during the selection process determines

their ability to move into the organization in the first place. Thus success depends upon the degree to which aspiring members

have correctly anticipated the expectations and desires of those in the organization in charge of selection.

b. Encounter Stage: -Upon entry into the organization, new members enter the encounter stage. Here the individuals confront

the possible dichotomy between their expectations about their jobs, their co-workers, their supervisors, and the organization in

general and reality. If expectations prove to have been more or less accurate, the encounter state merely provides a reaffirma-

tion of the perceptions generated earlier. However, this is often not the case. Where expectation and reality differ; new em-

ployees must undergo socialization that will detach them from their previous assumption and replace these with the organiza-

tion’s pivotal standards. Socialization, however, cannot solve all the expectation differences. At the extreme, some new mem-

bers may become totally disillusioned with the actualities of their jobs and resign. It is hoped that proper selection would signifi-

cantly reduce this latter occurrence.

c. Metamorphosis Stage: - Finally the new member must work out any problems discovered during the encounter stage. This

may mean going through changes. Hence the last stage is termed as metamorphosis stage. Metamorphosis is complete as is the

socialization process – when new members have become comfortable with the organization and their work teams. In this situa-

tion they will have internalized the norms of the organization and their co-workers; and they understand and accept these

norms. New members will feel accepted by their peers as trusted and valued individuals. They will have gained an understand-

ing of the organizational system- not only their own tasks but the rules, procedures and informally accepted practices as well.

Finally they will know how they are going to be evaluated. They will know what is expected of them and what constitutes a good

job. Consequently, successful metamorphosis should have positive effect on a new employee’s productivity and the employee’s

commitment to the organization, and should reduce the likelihood that the employee will leave the organization any time soon.

III. Many People socialize new Hires - New employee socialization or orientation covers the activities involved in introducing a

new employee to the organization and to his or her work unit. How is responsible for the orientation of new employee? This can

be done by the supervisor, the people in HRM, Peers, CEO, or combination of any of these.

a. HRM Department: HRM department can conduct the orientation in order to socialize the newly hired employees with the

working environment of the organization. HRM plays a major role in new employee orientation-the role of coordination, which

ensures that the appropriate components are in place. In addition HRM also serves as a participant in program. As job offers are

made and accepted, HRM should instruct the new employee when to report to work. However, before the employee formally

arrives, HRM must be prepared to handle some of the more routine needs of these individuals.

b. Supervisor: Immediate supervisor of particular department can also be the source of informing the employees about the cul-

ture, rules, procedures and policies of the organization. Mostly in smaller organizations, orientation may mean the new member

reports to supervisor, who then assigns the new member to other employee who will introduce the new member to other co-

workers. This may be followed by a quick tour to show the different parts and departments of the organization.

c. Peers: Peers and co-workers of the new hires can perform the orientation function in order to tell the expectation of employ-

ers and requirements of the organization as can also answer the queries raised from the employee side.

d. Organizational culture: Organizational culture itself can express the do’s and don’ts of any organization. Every organization

has its own unique culture. This culture includes longstanding, and often unwritten, rules and regulation; a special language that

facilitates communication among members; shared standards of relevance as to the critical aspects of the work that is to be

done; standards for social etiquette, customs for how members should relate to peers, employees, bosses and outsiders; what

is appropriate and smart behaviour with in organization and what is not.

e. CEO: Prior to mid-1980s, new employee orientation operated, if at all, with out any output from the company’s executive

management. But that began to change, due in part to management consultants advocating that senior management become

more accessible to employees. The CEO’s first responsibility is to welcome new employees aboard and talk to them about what

a good job choice they made. The CEO is in position to inspire these new employees by talking about what it is like to work for

23 BAJRANG/KUCHAMAN/BL7665843205@OUTLOOK.COM/MBA/NOTES/HUMAN-RESOURCE/MANAGEMENT

the organization. When CEO is present in the socialization process, the company is sending a message that it truly cares for its

employees.

IV. Employee Orientation program: - Orientation or socialization process.

a. Introduction: Regarding the organization, supervisor, trainers, and co-workers and to system

b. Job Duties: It provides job related information like, Job location Job tasks Job safety requirements Overview of job, Job objec-

tives Relationship to other jobs

c. Organizational Issues: This provides the information about the overall organization it may include; History of employer, or-

ganization of employer, name & titles of key executive, employee’s titles and departments, layout of physical facilities, proba-

tionary period, overview of production process, company policies and rules, disciplinary regulations, employee handbook, safety

procedures etc

d. Employee Benefits: This part provides the information about the benefits that are offered by the organization like; Pay scales

& paydays, vacations rest break, training & education benefits, counseling, housing facilities, insurance benefits, retirement

program, employee-provided services for employees, rehabilitation program

The Hiring Process - Hiring process is completed here because orientation or the socialization process is the last step of hiring.

B. Training - Training is a process whereby people acquire capabilities to aid in the achievement of organizational goals. It in-

volves planned learning activities designed to improve an employee’s performance at her/his current job. Training refers to the

methods used to give new or present employees the skills they need to perform their jobs.

C. Development - All efforts to provide employees with the abilities the organizations will need in the future

D. Training and Development Trends:

Skill requirements will continue to increase

Workforce will become significantly better educated & more diverse

Corporate restructuring reshapes businesses

Technology will revolutionize certain training delivery methods

The role of training departments will change

More flexible courses aimed specifically at performance improvement

More firms will strive to become learning organizations

Emphasis on human performance management will accelerate

Training of Employees: Meaning, Objectives, Need and Importance

Training is concerned with increasing the knowledge and skills of employees for doing specific jobs, and development involves

the growth of employees in all aspects.

Whereas training increases job skills, development shapes attitudes of employees.

Meaning of Training:

“Training is the act of increasing the knowledge and skills of an employee for doing a particular job.” — Edwin B. Flippo

Training is an organized activity for increasing the technical skills of the employees to enable them to do particular jobs efficient-

ly. In other words, training provides the workers with facility to gain technical knowledge and to learn new skills to do specific

jobs. Training is equally important for the existing as well as the new employees. It enables the new employees to get acquaint-

ed with their jobs and also increase the job-related knowledge and skills.

Objectives of Training: The objectives of training are as follows:

(i) To provide job related knowledge to the workers.

(ii) To impart skills among the workers systematically so that they may learn quickly.

(iii) To bring about change in the attitudes of the workers towards fellow workers, supervisor and the organization.

(iv) To improve the productivity of the workers and the organization.

(v) To reduce the number of accidents by providing safety training to the workers,

(vi) To make the workers handle materials, machines and equipment efficiently and thus to check wastage of time and re-

sources.

(vii) To prepare workers for promotion to higher jobs by imparting them advanced skills.

Need and Importance of Training: Why is Employees’ Training Necessary?

The need for training of employees arises due to the following factors:

(i) Higher Productivity: - It is essential to increase productivity and reduce cost of production for meeting competition in the

market. Effective training can help increase productivity of workers by imparting the required skills.

(ii) Quality Improvement: - The customers have become quality conscious and their requirement keep on changing. To satisfy

the customers, quality of products must be continuously improved through training of workers.

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(iii) Reduction of Learning Time: - Systematic training through trained instructors is essential to reduce the training period. If the

workers learn through trial and error, they will take a longer time and even may not be able to learn right methods of doing

work.

(iv) Industrial Safety: - Trained workers can handle the machines safely. They also know the use of various safety devices in the

factory. Thus, they are less prone to industrial accidents.

(iv) Reduction of Turnover and Absenteeism: - Training creates a feeling of confidence in the minds of the workers. It gives them

a security at the workplace. As a result, labour turnover and absenteeism rates are reduced.

(vi) Technology Update: - Technology is changing at a fast pace. The workers must learn new techniques to make use of advance

technology. Thus, training should be treated as a continuous process to update the employees in the new methods and proce-

dures.

(vii) Effective Management: - Training can be used as an effective tool of planning and control. It develops skills among workers

and prepares them for handling present and future jobs. It helps in reducing the costs of supervision, wastages and industrial

accidents. It also helps increase productivity and quality which are the cherished goals of any modern organization.

EFFECT OF MANPOWER TRAINING AND DEVELOPMENT IN SERVICE ORGANIZATIONS

FOR THE STUDY THEORETICAL FRAMEWORK

Until recently there has been a general resistance to investment of training in the public service because of the believe that

“Employees hired under a meut system must be presumed to be qualified, that they were already trained for their jobs and that

if this was not so it was evidence that initial selection of personnal was at fault.’’(stahl, 1976). This assumption has been jetti-

soned as the need for training became obvious both in the private and the public sectors.

Training has become more obvious given the growing complexity of the work environment, the rapid change in organiza-

tion and technological advancement which further necessitates the need of training and development of personnel to meet the

challenges. Many organizations have come to recognize that training offers a way of “developing skills, enhancing productivity

and quality of work and building workers loyalty to the firm”.

Manpower training and development is essential to the existence and survival of organization. It is common for people to see

training and development as the same thing. However, though they are similar, they are not the same thing.

Training is any learning activity which is directed toward the acquisition of specific knowledge and skills for the purpose of an

occupation or task (cole 1993).

Ivancevich et al (1994) see training as the systematic process altering employee’s behaviour to further organization goals.

According to Hellriegel and Slocum (1996), training is improving an employee’s skill to the point where he or she can do the

current job. Training is the process by which members of organizations are thought to acquire knowledge, skills and abilities

they need to perform effectively the job at hand. Training is directed at the present job.

In a more comprehensive manner, training can be defined as a short term process that utilizes a systematic and organized ac-

tivities by which non-managerial staff acquire the technical knowledge, skills and abilities for specific purposes in function.

Training is “an organized procedure by which people learn knowledge and or skills for a definite purpose. It is a process for

equipping the employees particularly the non-managerial employees with specific skills for example technical skills like plumb-

ing, electrical wiring, repairing, artistic skills, clerical and typing skills that would enable them to improve on their performance

and overall efficiency.

The objective of job training is to enable an employee to perform his job in such a way as to meet the standards of output,

quality, waste control, safety and other operational requirement (Gardner, 1973).

Thomas (1988) defines training as ‘a process through which experiences are deliberately offered to trainees to enable them to

absorb some new perspective, understanding, value, attitude, techniques or skills’. It involves planned activities on the part of

an organization to increase job knowledge and skills or modify the attitudes and social behaviour of its members in the ways

that are consistent with the goals of the organization and the requirements of the job. The overall aim is to increase or improve

a person’s contribution to the achievement of the organizational goals.

Jones, George and Hill, (2000) believe that training primarily focuses on teaching organizational members how to perform

their current jobs and helping them acquire the knowledge and skills they need to be effective performers.

According to carrel and kuzmits (1982) training is the systematic process by which employees learn skills, information or atti-

tudes to further organizational and personal goal. They also stated that “every training system operates with a philosophy set of

beliefs concerning people, productivity and profit”.

In view of chruden and Sherman Jnr (1980), training is any organizationally oriented procedure, which is intended to foster

learning among organizational members.

Training according to Davar (1950), states that its main goal is “To induce a suitable change in the individual concerned”. It is

“to bridge the gap between existing performance ability and desired performance”.

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Development on the other hand focuses on building the knowledge and skills of organizational members so that they will be

prepared to take on new responsibilities and challenges. Development is used in relation to the process of helping managerial

employees who perform non-routine jobs to improve their managerial, administrative and decision-making abilities and compe-

tence.

In the view of adamolekun (1983), staff development involves the training, education and career development has been

identified to include:

Creating a pool of readily available and adequate replacements for personnel who may leave or move up in the organiza-

tion;

Enhancing the company’s ability to adopt and use advances in technology because of a sufficiently knowledgeable staff;

Building a more efficient, effective and highly motivated team which enhance the company’s (AJ pam vol xvi; No.1.Jan

2005) competitive position and improves employee morale; and

Ensuring adequate human resources for expansion into new programs.

Drucker (1977) in highlighting the work of managers submits that one contribution a manager is uniquely expected to make is

to develop people. if any organization must continue to survive, it must provide opportunity for career development into spe-

cialist and managerial positions.

Development is the process of building the knowledge and skills of organizational members so that they will be prepared to take

a new responsibility and challenges. Jones, George and hill(2000).

Wertherland and Davis (1996) define development to mean helping individual worker to handle future responsibilities with little

concern for current duties.

Development can also be defined as a deliberate program of an organization to mould into the desirable shape its future leaders

who are expected to perpetuate the business of the organization most efficient and effectively, ( o.b. fagbohungbe 2009). De-

velopment can be referred to as any learning activity which is directed towards future needs rather than present needs and

which is concerned more with career growth than immediate performance (cole 1993). The intent of development program is to

improve an employee’s conceptual and human skills in preparation for future jobs.

From the above, it is now clear that there is a major difference between them. Though both of them are geared towards in-

creasing or improving the skills of workers. Training is concerned with teaching the workers specific skills that will assist them in

their immediate task while development on the other hand is concerned with teaching the workers more general skills that will

assist them in career growth thereby equipping them for the future.

As a way of summary, the purpose of training is to improve knowledge and skills and to change attitude (mullins,1999).

Training and development as stokes (1966) puts it rest on the fact that “a person learns through experience which may be actu-

al, hearing or reading about the experiences of others”.

Training and development can also be viewed as a formal and informal activities which bring about change in the skills,

knowledge and attitude of employees for the fulfillment of their individual career and organizational goals.

2.1.1 FACTORS THAT TRIGGER TRAINING AND DEVELOPMENT

Training and development is predicted on workers, machines and tool deficiencies. These deficiencies manifest inform of specif-

ic symptoms. The symptoms that trigger training and development in organization may include:

When there is high rate of absenteeism among workers.

Where there is increased labour turnover among workers.

When there is decline in productivity among workers.

When there is a poor job performance among workers.

When new machines are purchased to replace old ones.

When there is increase in the rate of on-the-job accidents

among workers.

When there is an increased complaint from customer.

When there is reduced patronage from customers.

When there is visible negative work attitudes such as late-

ness and oscillation (motion without movement or pretend-

ing to be busy when in actual fact he or she is doing noth-

ing) among workers.

When there is noticed inability to take up challenges among

workers.

When there is noticed reduction

In job involvement and organizational commitment.

2.1.2 FORMAL TRAINING - It entails the deliberate and structured presentation of experiences, which may help the individuals

to change their knowledge, understanding attitudes or behaviours in a positive manner. In industry, formal training is used for

any of a variety of specific purposes as stated below:

Induction Training: It involves the introduction of the new entrant to the undertaking and its ways including the structures,

rules and procedures of the company to enable him to cope with the new environment.

Skill Acquisition: Involves the development of new skills and abilities. Where ‘deskilling’ of work takes place, semi-skilled ma-

chine operators may be provided with the kind and degree of training necessary to acquire the required skill.

26 BAJRANG/KUCHAMAN/BL7665843205@OUTLOOK.COM/MBA/NOTES/HUMAN-RESOURCE/MANAGEMENT

Skill Development: Training is employed to ‘up-date’ a person’s knowledge or skills at any stage of his career and whenever

changes occur in his work such as where new technology is introduced. In the latter case, short courses, which provide infor-

mation on the ‘new thing’ and offer the opportunity to learn and practice new skills or new application of old ones may be un-

dertaken.

Increasing Motivation: It entails deliberate use of training to increase individual’s willingness to work up to the required pat-

tern and standards. This rest on the belief that people are likely to work more effectively. They understand not only what they

are expected to do, but why they are expected to do it in this way. The inculcation of work-related values and norms is possi-

ble in training.

Attitude Change: Training may be undertaken to change the perspective and attitudes workers adopt in relation to the organi-

zation and their work in it in a positive way. It could develop into employees trust, commitment to the organization, job in-

volvement and job satisfaction.

2.1.3 AIMS OF TRAINING AND DEVELOPMENT

The aim of training and development include:

o To change the job behaviour or attitude of employees so that they can perform to defined standards.

o To reduce the “hibernating time”. This is the gap between placement and the point at which an employee start to perform ef-

fectively.

o To improve the productive capacity of individual employee.

o To improve the effectiveness of the organization.

Importance of training and development in an organization

In an ever changing and fast paced corporate world, training and development is an indispensable function.

Training and development is one of the lowest things on the priority list of most companies. When it's organized, it is often at

the persistence of the human resources department. There is, however, enormous value in organizing proper training and de-

velopment sessions for employees. Training allows employees to acquire new skills, sharpen existing ones, perform better, in-

crease productivity and be better leaders. Since a company is the sum total of what employees achieve individually, organiza-

tions should do everything in their power to ensure that employees perform at their peak.

Here are a few reasons that demonstrate the importance of training and development.

New Hire Orientation - Training is particularly important for new employees. This can be conducted by someone within the

company and should serve as a platform to get new employees up to speed with the processes of the company and address any

skill gaps.

Tackle shortcomings - Every individual has some shortcomings and training and development helps employees iron them out.

For example, at Rate Gain we have divided the entire headcount in several groups to provide focused training which is relevant

to those groups - sales training, first time managers, middle management, senior leadership, executive leadership.

Improvement in performance - If shortcomings and weaknesses are addressed, it is obvious that an employee's performance

improves. Training and development, however, also goes on to amplify your strengths and acquire new skill sets. It is important

for a company to break down the training and development needs to target relevant individuals. If I can draw examples from my

organization, every department has targeted training groups. These generally revolve around product development training, QA

training, PMP among others where internal and external process experts facilitate various programs.

Employee satisfaction - A company that invests in training and development generally tends to have satisfied employees. How-

ever, the exercise has to be relevant to the employees and one from which they can learn and take back something. It will be fu-

tile if training and development become tedious and dull, and employees attend it merely because they have to. As a company,

we stress on industry specific training and send many employees for international seminars and conferences that can be benefi-

cial to them.

Increased productivity - In a rapidly evolving landscape, productivity is not only dependent on employees, but also on the tech-

nology they use. Training and development goes a long way in getting employees up to date with new technology, use existing

ones better and then discard the outdate ones. This goes a long way in getting things done efficiently and in the most produc-

tive way.

Self driven - Employees who have attended the right trainings need lesser supervision and guidance. Training develops neces-

sary skill sets in employees and enables them to address tasks independently. This also allows supervisors and management to

focus on more pressing areas.

To transform our company into a learning organization and encourage a culture of continual learning among employees, we

have launched a training and development initiative called 'RateGain Lighthouse'. We call it lighthouse, as it symbolizes

strength, guidance and direction. We conduct various in-house training sessions on knowledge-building and skills & process.

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The network facilitates various training sessions, based on experiential learning methodologies. We have also engaged globally

renowned experts like Aaron Ross, author of 'Predictable revenue' and world renowned Sales coach and trainer. His session for

our sales teams have transformed the way we are working. The results from our training and development initiatives have been

very positive and it clearly shows that it is not a fad.

Training and development programs can have a huge impact on a company. Like every other function in your company, training

and development should be focused on producing targeted and tangible results for the business. The key is to treat it seriously

and consider it a capital investment and make it results-driven.

Performance Appraisal Vs Performance Management

Comparison Chart

BASIS FOR COMPARISON PERFORMANCE APPRAISAL PERFORMANCE MANAGEMENT

Meaning Performance Appraisal, means the analysis of an

employee's performance and their calibre for future

growth and development.

Performance Management is the man-

agement of human resources in an or-

ganization.

What is it? It is a system. It is a process.

Nature Rigid Supple

Type of tool Operational Tool Strategic Tool

Owned by Human Resource Department Managers

Conducted Annually Continuously

Approach Individualistic Holistic

Focused on Quantitative Aspects Qualitative Aspects

Corrections Retrospective Prospective

Definition of Performance Appraisal

Performance Appraisal is defined as an assessment of employees by the manager, in which he evaluates the overall contribution

made by the employee to the organization. It is a systematic and logical review, conducted by the organization annually to judge

his potential in performing a task. It helps to analyze the skills and abilities of an employee for their future growth that increases

productivity of employees. It helps to identify, the employee who performs their task well and those who are not, along with

the reasons for the same.

Performance Appraisal, is an organized way of evaluating employee performance, for which a comparison is made between ac-

tual performance and the preset standards. The results of the performance appraisal are documented. After that reviews are

given to the employee about their performance during the year, to tell them where they require improvements. Employees also

wish to know their position in the organization after a particular period of time.

You can understand the procedure of the performance appraisal, with the help of following diagram:

Definition of Performance Management

Performance Management is a continuous process that aims at planning, monitoring and evaluating the objectives of an em-

ployee and his total contribution to the organization. The basic purpose of performance management is to encourage and im-

prove employee’s efficiency and effectiveness.

In this process both the employees and the managers participate in setting the objectives, assessing the performance or pro-

gress, providing training and feedback to the employees at regular intervals

for improvement, implementing development programs for employees and

rewarding them for their achievements.

With the help of this process both the employee and the employer get a

chance to set the combined goals of the employee that relates to the ulti-

mate goal of the organization by considering the employee’s performance. In

this way, the objectives of the parties became clear that helps to achieve the

overall objectives of the organization and the growth & development of the

employee as well.

Key Differences B/w Performance Appraisal and Performance Management

The following are the major differences between performance appraisal and

performance management:

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1. An organized way of evaluating the performance and potential of employees for their future growth and development is

known as Performance Appraisal. The complete process of managing the human resources of the organization is known as

Performance Management.

2. Performance Appraisal is a system while Performance Management is a process.

3. Performance appraisal is inflexible, but performance management is flexible.

4. Performance Appraisal is an operational tool to improve the efficiency of employees, however performance management is a

strategic tool.

5. Performance Appraisal is conducted by a human resource department of the organization, whereas managers are held re-

sponsible for performance management.

6. In performance appraisal, corrections are made retrospectively. In contrast to performance management is forward looking.

7. Performance Appraisal is having an individualistic approach which is just opposite in case of Performance Management.

8. Performance Appraisal is carried on eventually, but Performance Management is an on-going process.

Conclusion

Therefore, we can say that the term performance appraisal and performance management are completely different. But, it can’t

be said that they are contradictory because performance appraisal itself is a part of performance management. In this way, we

can say that performance management is a bigger term that involves a number of steps.

What are the modern methods of performance appraisal?

1. Assessment centre method: This method was used for the first time in 1930 by the German army and then in 1960’s by the

British army. This method tests a candidate in different social situations using a number of assessor and procedures. The per-

formance of an employee an also his potential for a new job is evaluated in this method by assessing his performance on job re-

lated simulations. Characteristics that the concerned managers feel are important for the success of a particular job are includ-

ed in these simulations. Techniques like business games role playing and in basket exercises are used in this method. The em-

ployees are evaluated individually as well as collectively on job related characteristics. Personal interview and projective tests

help in assessing the motivation, career orientation and dependence on others of an employee. To measure the intellectual ca-

pacity written tests are used. The evaluators in this method consist of experienced manager working at different levels who

prepare a summary report for the management as well as for the employees. This technique usually measures the planning abil-

ity interpersonal skills and organizational skills of an employee.

2. Human Resource Accounting Method: Human resources are a valuable asset for any organization and it can be valued in

monetary terms. This method evaluates the performance of an employee in terms of costs and contributions. HR costs include

expenses incurred on HR planning recruitment selection induction and training. The difference between this costs and the con-

tribution by an employee reflects the performance of that employee. This method is still developing hence is not very popular at

present.

3. Behaviourally anchored rating scale (BARS): This method combines the graphic rating scale and the critical incident method.

It determines in advance the critical areas of the performance and the most effective behaviour to achieve the results. Then the

actual job behaviour of an employee is evaluated against the predetermined behaviour.

The following steps are used for constructing BARS.

1. Supervisor and other persons well acquainted with a job are asked to describe specific critical incidence of effective perfor-

mance behaviour

2. Then these persons categorized the incidents into sets of performance dimensions and each set is then defined.

3. These people then reallocate the original critical incidents. They are given the cluster definition and critical incidents and are

asked to re-design each incident to the dimensions that describes it the best. A critical incident is retaining only a some percent-

age that is usually between 50% – 80% of this group assigns the incidents to the same cluster as was done by the earlier group.

4. The second group then rates each incident on a 7 – 9 point scale where the rating is done on the basis of how well the behav-

iour described in the incidents represented the performance on the appropriate dimensions.

5. A sub set of incidents is used as behaviour anchors for the performance dimensions.

4 Appraisal through management by objectives (MBO): This concept was introduced by PETER DRUCKER in 1954 who named it

management by objectives and self-control. It is an effective way it is also known as goal setting approach to appraisal .In this

process the supervisor and subordinate members jointly identify the common goals of the organization and set the areas of the

responsibility of each individual in terms of results expected from that person. These measures are used for operating the unit

as well as for appraising the performance of the employees.

5 The 360 degree appraisal: The 360 degree method of performance appraisal is used to make the appraisal process more

transparent, objective and participative. It introduced the concepts of self-appraisal subordinate’s appraisal, peer appraisal and

appraisal by customers. It is called a 360 degree method because it involves the evaluation of an employee by persons above

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him, below him and alongside him. Structured questionnaires are used to collect information from the seniors, subordinates

and peers. The employee to be evaluated thus acquires a central position and everyone around him participates in the appraisal

process in the 360 degree method. The following four are the main components of 360 degree appraisal:

Self-appraisal: It allows an employee complete freedom in accessing his or her strengths objectively and identifying the areas of

development. The employees get a chance to share the development areas with their seniors based on their self-appraisal and

jointly worked out a plan in tune with the organizational realities like the availability of resources and time. It also gives a chance

to the employee to express his career plans which is in the interest of the organization as it knows beforehand the aspirations of

its employee.

Appraisal by superiors: An appraisal by superiors involves providing constructive, feedback about the performance of any em-

ployee as well as his development areas during the review period. It helps in setting goals for the employees that help in achieve

the organizational goals and improve the performance of the employee. The career aspirations of an employee are also put in

proper prospective.

Appraisal by subordinates: This is a unique feature of the 360 degree method of appraisal. As the subordinates play an im-

portant role in the performance of the employee. The feedback by the subordinates gives first-hand account of how they look at

their superior in terms of working style. The capability of a superior in motivating, delegating the work, building a team and

communicating with them effectively form the basis of appraisal by the subordinates.

Peer appraisal: It also plays an important role in 360 degree appraisal as the role of peers is quite important in life of an em-

ployee. Selecting the right peers is very important and peers from the departments that are directly related with the depart-

ment of the employee should also be included. It mainly focuses on feedback about the style of functioning of the employee

under review and can also include his ability to work as team leader besides his co-operation and collaboration.

Potential appraisal: It is different from performance appraisal as it refers to the abilities of the employees that are not being

used at the time of appraisal. It searches for the latent abilities of the employee in discharging higher responsibilities in future.

The potential of the employees is judged on the basis of his present performance, personality traits, past experience and age

and qualification. It also looks at the unused skills and knowledge of an employee. It aims at informing the employee their fu-

ture prospectus and helps the organization in drawing your suitable successions plan. It also requires updating the training ef-

forts regularly and advised the employees on things which they can do to improve their career prospectus.

What are the techniques of Performance Appraisal?

The techniques of appraisal have been divided into two categories: The modern and the traditional techniques. While the tradi-

tional methods base their findings on the personality trades of an individual like creativity, responsibility, and leadership, the

modern techniques laid more stress on the evaluation of work results. The traditional methods or techniques are:

1. Confidential report: It is used for promotion and transfer of an employee and is prepared by the immediate superior who de-

scribes in detail the strength and weaknesses along with major achievements and failures of the employee. The personality and

behaviours of the employee also find mention in this report.

2. Essay or free form method: As the name suggests the appraiser write a short essay detailing the performance of the employ-

ee. It is a very time consuming method and is prone to buys also as specific performance dimensions are not considered. The

quality of appraisal also depends on the writing skills of the appraiser. It is also difficult to compare two Essay appraisals as there

is no common criterion for the appraiser.

3. Strayed ranking method: This is the old and simplest method of performance appraisal. In this method ranks are assigned

relatively to all the employees working in the same unit and doing the same job without analysing their performance. The

method biased as the ranking is not based on the specific performance measures of a job. It can be cumbersome if the number

of employees is very large. The other limitations of this method are that it only tells how an employee stands in comparison

with other employees.

4. Forced distribution method: In this method the evaluator is required to distribute his rating in the form of normal frequency

distribution. Employees are shown in categories that range from poor to excellent by the evaluator. This method was evolved by

Joseph Tiffin but it also suffers from certain limitations as the performance criteria related to a job are not used and the reasons

for assigning a category to particular employee are not clear.

5. Graphic or linear rating scale: In this method a numerical scale is used which indicates different degrees to a particular trait.

These traits can be initiative dependability creativity attitude loyalty emotional stability and co-ordination. The evaluator gives a

particular ranking on each trait to every employee. Two types of rating scales are used: Continuous and discontinues. In first

type degree of a trait is measure along a continuum like 0 1 2 3. IN discontinues rating scale boxes are used to show the differ-

ent degrees of the traits like (I) no interest (II) indifferent (III) Interesting (IV) enthusiastic (V) very enthusiastic.

6. Critical incident method: This method was developed after a research by the armed forces of United States of the 2nd world

war. It is based on a principal that there are some significant acts in the behaviours and performance of every employee which

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can lead to the success of failure on the job. The supervisor keeps a record of these events which can be good or bad and also

records the behaviour of the employee during such an event. The ratings of the employee depend on the positive or negative

behaviour during these events. This method also has certain limitations like it is cumbersome and time consuming and a lot of

important information is lost while coating the incident after a considerable gap of time. Continues record keeping is also not

possible as such events keep on happening frequently. The bios by the supervisor in reporting these incidents can also not be

ruled out completely.

7. Group appraisal method: Employees are rated by a group of people comprising the immediate supervisor of the employee

and other supervisor who have the knowledge of the employee work along with the concerned head of the department and a

personnel expert. This group determines the standards and then measures the actual performance of the employee. It suggests

creative measures after analysing the causes of poor performance. Though it is a time consuming method, it is free from bias.

Do check the methods of performance appraisal here

What is the process of Performance Appraisal?

Performance appraisal process has the following steps:

1. The first step in the process is the establishment of performance standards against which the output can be measured.

2. These standards are them communicated the employees as well as to the evaluators. This step helps the employees know

what is expected from them and the feedback from the employees can be used for making any require changes in these stand-

ards.

3. The next step is to measure the actual performance against these standards a suitable technique for measurement is selected

and the internal and external factors that influence the performance are also identified. Information on results is gathered and

four sources are most commonly used to measure the actual performance. These are personal observations, Oral reports, writ-

ten reports and statistical reports.

4. The results of the appraisal are then shared with the employee so that he become aware of the deviation in performance and

can also identify and analyse the cause behind this deviation. This help and employee in identifying his strengths and weakness-

es and improve future performance.

5. Corrective actions is then undertaken to improve the performance of the employees the common tools for corrective action

are coaching, counselling and training.

What is Performance Planning?

Performance planning is a process in which it is determining that how a job has to be done and how the success of the job is to

be defined as measured. Performance planning for the employees close from the organizational goals and is jointly undertaken

by the employee and his supervisor. It is different from performance appraisal as it is more concern with what and how to ap-

praise as against the need for appraisal in performance planning. The process of performance planning is a under:

1. The job objectives of an employee are formulated by him in consultation with his supervisor keeping in mind the organiza-

tional objectives. This helps the employee understand the results expected from him.

2. During this process each and every objective and its contribution in the fulfilment of the organizational objectives is discussed

in detail. The method of determining the success of each objective is also determined.

3. The need for any developmental activity which might be useful in preparing the employee for the successful discharged of his

new responsibilities is also worked out.

4. After the performance plan is prepared it becomes the responsibility of the employee to successfully carry out the plan and

achieve the objectives/targets decided in the plan. The supervisor now assumes the role of a coach and counsellor.

Job Evaluation: Concept, Objectives and Procedure of Job Evaluation

Concept of job evaluation: - In simple words, job evaluation is the rating of jobs in an organisation. This is the process of estab-

lishing the value or worth of jobs in a job hierarchy. It attempts to compare the relative intrinsic value or worth of jobs within an

organisation. Thus, job evaluation is a comparative process.

Below are given some important definitions of job evaluation: According to the International Labour Office (ILO) “Job evalua-

tion is an attempt to determine and compare the demands which the normal performance of a particular job makes on normal

workers, without taking into account the individual abilities or performance of the workers concerned”.

The British Institute of Management defines job evaluation as “the process of analysis and assessment of jobs to ascertain relia-

bly their negative worth using the assessment as the basis for a balanced wage structure”. In the words of Kimball and Kimball

“Job evaluation is an effort to determine the relative value of every job in a plant to determine what the fair basic wage for such

a job should be”.

Wendell French defines job evaluation as “a process of determining the relative worth of the various jobs within the organisa-

tion, so that differential wages may be paid to jobs of different worth. The relative worth of a job means relative value pro-

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duced. The variables which are assumed to be related to value produced are such factors as responsibility, skill, effort and work-

ing conditions”.

Now, we may define job evaluation as a process used to establish the relative worth of jobs in a job hierarchy. This is important

to note that job evaluation is ranking of job, not job holder. Job holders are rated through performance appraisal. Job evaluation

assumes normal performance of the job by a worker. Thus, the process ignores individual abilities of the job holder.

Job evaluation provides basis for developing job hierarchy and fixing a pay structure. It must be remembered that job evaluation

is about relationships and not absolutes. That is why job evaluation cannot be the sole determining factor for deciding pay

structures.

External factors like labour market conditions, collective bargaining and individual differences do also affect the levels of wages

it, organisations. Nonetheless, job evaluation can certainly provide an objective standard from which modifications can be made

in fixing wage structure.

The starting point to job evaluation is job analysis. No job can be evaluated unless and until it is analysed. How job evaluation is

different from job analysis, job description and job specification is given in the following Table 14.1.

Objectives of job evaluation: - The main objective of job evaluation is to determine relative worth of different jobs in an organi-

sation to serve as a basis for developing equitable salary structure. States an ILO Report the aim of the majority of systems of

job evaluation is to establish, on agreed logical basis, the relative values of different jobs in a given plant or machinery i.e. it

aims at determining the relative worth of a job. The principle upon which all job evaluation schemes are based is that of describ-

ing and assessing the value of all jobs in the firms in terms of a number of factors, the relative importance of which varies from

job to job.

The objectives of job evaluation, to put in a more orderly manner are to:

1. Provide a standard procedure for determining the relative worth of each job in a plant.

2. Determine equitable wage differentials between different jobs in the organisation.

3. Eliminate wage inequalities.

4. Ensure that like wages are paid to all qualified employees for like work.

5. Form a basis for fixing incentives and different bonus plans.

6. Serve as a useful reference for setting individual grievances regarding wage rates.

7. Provide information for work organisation, employees’ selection, placement, training and numerous other similar problems.

8. Provide a benchmark for making career planning for the employees in the organisation.

Procedure of job evaluation: - Though the common objective of job evaluation is to establish the relative worth of jobs in a job

hierarchy, there is no common procedure of job evaluation fol-

lowed by all organisations. As such, the procedure of job evalu-

ation varies from organisation to organisation. For example, a

job e valuation procedure may consist of the eight stages as de-

lineated in Figure 14.1.

1. Preliminary Stage: - This is the stage setting for job evalua-

tion programme. In this stage, the required information’s ob-

tained about present arrangements, decisions are made on the

need for a new programme or revision of an existing one and a

clear cut choice is made of the type of programme is to be used

by the organisation.

2. Planning Stage: - In this stage, the evaluation programme is

drawn up and the job holders to be affected are informed. Due

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arrangements are made for setting up joint working parties and the sample of jobs to be evaluated is selected.

3. Analysis Stage: - This is the stage when required information about the sample of jobs is collected. This information serves as

a basis for the internal and external evaluation of jobs.

4. Internal Evaluation Stage: - Next to analysis stage is internal evaluation stage. In the internal evaluation stage, the sample of

bench-mark jobs are ranked by means of the chosen evaluation scheme as drawn up at the planning stage. Jobs are then graded

on the basis of data pending the collection of market rate data. Relative worth of jobs is ascertained by comparing grades be-

tween the jobs.

5. External Evaluation Stage: - In this stage, information is collected on market rates at that time.

6. Design Stage: - Having ascertained grades for jobs, salary structure is designed in this stage.

7. Grading Stage: - This is the stage in which different jobs are slotted into the salary structure as designed in the preceding

stage 6.

8. Developing and Maintaining Stage: - This is the final stage in a job evaluation programme. In this stage, procedures for main-

taining the salary structure are developed with a view to accommodate inflationary pressures in the salary levels, grading new

jobs into the structure and regarding the existing jobs in the light of changes in their responsibilities and market rates.

In India, the Indian Institute of Personnel Management, Kolkata has suggested the following five steps to be taken to develop

a job evaluation programme:

1. Analyse and Prepare Job Description

2. Select and Prepare a Job Evaluation

Programme/Plan

3. Classify Jobs

4. Install the Programme

5. Maintain the Programme

These steps are self-explanatory. Hence are not discussed in detail.

Advantages of job evaluation:

According to an ILO publication job evaluation offers the following advantages:

1. Job evaluation being a logical process and objective technique helps in developing an equitable and consistent wage and sala-

ry structure based on the relative worth of jobs in an organisation.

2. By eliminating wage differentials within the organisation, job evaluation helps in minimizing conflict between labour unions

and management and, in turn, helps in promoting harmonious relations between them.

3. Job evaluation simplifies wage administration by establishing uniformity in wage rates.

4. It provides a logical basis for wage negotiations and collective bargaining.

5. In the case of new jobs, job evaluation facilitates spotting them into the existing wage and salary structure.

6. In the modem times of mechanisation, performance depends much on the machines than on the worker himself/herself. In

such cases, job evaluation provides the realistic basis for determination of wages.

7. The information generated by job evaluation may also be used for improvement of selection, transfer and promotion proce-

dures on the basis of comparative job requirements.

8. Job evaluation rates the job, not the workers. Organisations have large number of jobs with specialisations. It is job evalua-

tion here again which helps in rating all these jobs and determining the wages and salary and also removing ambiguity in them.

Drawbacks of job evaluation:

In spite of many advantages, job evaluation suffers from the following drawbacks/limitations:

1. Job evaluation is susceptible because of human error and subjective judgment. While there is no standard list of factors to be

considered for job evaluation, there are some factors that cannot be measured accurately.

2. There is a variation between wages fixed through job evaluation and market forces. Say Kerr and Fisher, the jobs which tend

to rate high as compared with the market are those of junior, nurse and typist, while craft rates are relatively low. Weaker

groups are better served by an evaluation plan than by the market, the former places the emphasis not on force but on equity”.

3. When job evaluation is applied for the first time in an organisation, it creates doubts in the minds of workers whose jobs are

evaluated and trade unions that it may do away with collective bargaining for fixing wage rates.

4. Job evaluation methods being lacking in scientific basis are often looked upon as suspicious about the efficacy of methods of

job evaluation.

5. Job evaluation is a time-consuming process requiring specialised technical personnel to undertake it and, thus, is likely to be

costly also.

6. Job evaluation is not found suitable for establishing the relative worth of the managerial jobs which are skill-oriented. But,

these skills cannot be measured in quantitative terms.

7. Given the changes in job contents and work conditions, frequent evaluation of jobs is essential. This is not always so easy and

simple.

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8. Job evaluation leads to frequent and substantial changes in wage and salary structures. This, in turn, creates financial burden

on organisation.

Determining Pay and Evaluating Jobs

In formulating salary offers for employees in new positions (both those new to Brown and those who are transferred or pro-

moted from within the University), the following considerations are taken into account: departmental budget; external equity;

internal equity and relevant education, experience and skills. Routinely, salary offers fall within the first quartile of the applica-

ble salary range for the position's grade level. Recommended salaries must be authorized by the appropriate Human Resources

Representative or Compensation Services prior to discussing with the candidate. No offer or promise of an offer can be made

without authorization by Human Resources.

External Equity is the term used to describe comparative salaries paid in the marketplace where Brown competes to hire and

retain similar types of employees. Compensation Services participates in various salary surveys to determine competitive pay

practices.

Internal Equity is the term used to describe the comparison of salaries paid to employees working in the same grade or level

within the University (both within the department and University-wide).

Brown recruits in various markets to fill positions, depending upon the requirements and level of the position. They are usually

as follows:

Department head level positions and above: national markets

Professional and administrative positions below department head level: regional markets

Support staff and entry level exempt positions: local markets

Brown is committed to a formal salary administration program through which the relative worth of a position to Brown and in

the labour market where we recruit can be determined.

The job evaluation process establishes the relative value of jobs throughout the University. There are two steps involved in this

process:

Job Descriptions - Each position has a job description that identifies the job's major responsibilities, decision making, ac-

countability, qualifications, and organizational relationships.

Job Evaluation - Brown uses the Hay System, which is the most widely used job evaluation system in the US. The Hay Sys-

tem measures three major factors: knowledge required for effective performance; the complexity of the decision making

role; and the authority or control invested within the position. These compensable factors are assessed and given a nu-

merical value. The total value is then matched to a corresponding Salary Range.

Salary surveys are another of the tools used by Compensation Services to compare Brown's staff salaries and compensation pol-

icies with a cross-section of other employers. Brown participates in multiple surveys to capture information about the breadth

of positions represented on campus. Compensation Services analyses this survey data and prepares a report each fall recom-

mending pay practices for the next fiscal year. The recommendations are presented to the University Resource Committee to

consider in determining salary increase pools and salary ranges during the budget planning and approval process.

Determination of Wages of Employee (Theories)

Theories regarding the determination of wages of employee are: (i) Subsistence theory (ii) Wage Fund Theory (iii) Surplus Value

Theory of Wages (iv) Residual Claimant Theory (v) Marginal Productivity Theory (vi) Bargaining Theory of Wages (vii) Behavioral

Theory of Wages.

These theories are discussed below:

(i) Subsistence theory: This theory propounded by the economists in the 18th century was later explained by David Ricardo.

This theory is based on two assumptions, namely,

(a) The law of diminishing return applies to industry.

(b) There is a rapid increase in population.

The subsistence theory laid down that ‘the workers are paid to enable them to subsist and perpetuate the race without increase

or diminution’. If the workers were paid more than subsistence wage, their numbers would increase as they would procreate

more; and this would bring down the rate of wages.

If the wages fall below the subsistence level, the number of workers would decrease—as many would die of hunger, malnutri-

tion, disease, cold, etc. and many would not marry, when that happened the wage rate would go up.

The subsistence theory is criticized on the following grounds:

(a) The subsistence theory does not take into consideration the demand for labour. It considers only the supply of labour and

the cost of production.

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(b) This theory is based on theory of population which is itself defective. It is wrong to say that population will increase if the

economic condition of the labour is improved. These days, better economic condition is associated with lower birth rate.

(c) In developed countries, workers are not merely contented with fulfillment of basic needs. They also require luxuries of life to

raise their standard of living.

(d) This theory does not emphasis the efficiency of the workers.

(e) This theory fails to explain the wage differentials in different regions and among different categories of workers.

(ii) Wage Fund Theory: This theory was developed by Adam Smith and was further expounded by J.S.Mill.

J.S. Mill said that wages mainly depend upon demand for and supply of labour or the proportion between population and capi-

tal available. The amount of Wages Fund is fixed. Wages can’t be increased without decreasing the number of workers and vice

versa. It is the Wages Fund which determines the demand for labour.

However, the supply of labour can’t be changed at a given time. But if the supply of labour increases along with increase in pop-

ulation, the average wages will go down. Therefore in order to increase the average wages, firstly, the Wages Fund should be

enlarged, secondly, the number of workers asking tor employment should be reduced.

This theory is criticised on the following grounds:

(a) This theory does not explain differences in wages at different levels and in different regions.

(b) It is not clear from where the Wages Fund will come.

(c) No emphasis has been given to the efficiency of workers and productive capacity of firms.

(d) This theory is unscientific as Wages Fund is created first and wages are determined later on. But in practice, the reverse is

true.

(iii) Surplus Value Theory of Wages: This theory was evolved by Kark Marx. According to this theory, the labour is an article for

commerce, which could be purchased on payment of subsistence price.’ The price of any product is determined by the labour

time needed for producing it.

The labourer is not paid in proportion to the time spent on work, but much less, and the surplus goes to be utilised for paying

other expenses.

(iv) Residual Claimant Theory: It was Francis A. Walker who propounded this theory. According to him, there were four factors

of production, viz., land, labour, capital and entrepreneurship. Wages represent the amount of value created in the production

which remains after payment has been made for all these factors of production. In other words, labour is the residual claimant.

The wages are equal to the whole production minus rent, interest, and profit.

(v) Marginal Productivity Theory: According to this theory, wages are based upon an entrepreneur’s estimate of the value that

will probably be produced by the last or marginal workers. In other words, it assumes that wages depend upon the demand for,

and supply of, labour. Consequently, workers are paid what they are economically worth. The result is that the employers has

larger share in profit as has not to pay to the non-marginal workers.

This theory is criticised on the following grounds:

(a) It is wrong to assume that more labour could be used without increasing the supply of production facilities.

(b) This theory is based on perfect competition in the market which is seldom found in practice.

(c) In practice, the employers offer wages less than the marginal productivity of labour. In many cases, the labour unions are

able to bargain for wages higher than the marginal productivity of labour.

(vi) Bargaining Theory of Wages: John Davidson propounded this theory. Under this theory, wages are determined by the rela-

tive bargaining power of workers of their union and of employers. When a trade union is involved, basic wages, fringe benefits,

job differentials and individual differences tend to be determined by the relative strength of the employers and the trade union.

However, this is possible in big plants which are earning huge profits and where labour is well organised. The profits earned by

the enterprise play an important role in determining the bargained wages.

(vii) Behavioural Theory of Wages: Many behavioural scientists—notably psychologists and sociologists- like March and Simon,

Robert Dubin, Eliot Jacques—have presented their views on wages and salaries on the basis of research studies and action pro-

grammes conducted by them. It has been found that wages are determined by such factors as . size and prestige of the compa-

ny, strength of the union, the employer’s concern to maintain the workers, contribution by different kinds of workers, etc.

Wage differentials are explained by social norms, traditions, customers prevalent in the organisation psychological pressures on

the management, prestige attached to certain jobs in terms of social status, need to maintain internal consistency in wages at

the higher levels, the wages paid for similar jobs in other firms, etc.

Employee Welfare - What Is Employee Welfare

Employee welfare is a term including various services, benefits and facilities offered to employees by the employers. The wel-

fare measures need not be monetary but in any kind/forms. This includes items such as allowances, housing, transportation,

35 BAJRANG/KUCHAMAN/BL7665843205@OUTLOOK.COM/MBA/NOTES/HUMAN-RESOURCE/MANAGEMENT

medical insurance and food. Employee welfare also includes monitoring of working conditions, creation of industrial harmony

through infrastructure for health, industrial relations and insurance against disease, accident and unemployment for the work-

ers and their families. Through such generous benefits the employer makes life worth living for employees.

Importance of Employee Welfare - As a business, you have to provide various benefits to ensure your employees' welfare.

While this may increase your business expense and negatively affect your bottom line, looking after your employees will benefit

you in other ways.

Compliance: As an owner, you are required by law to provide certain benefits for the welfare of your employees. You may have

to match the Social Security taxes your employees pay and obtain a worker's compensation insurance policy. If you terminate an

employee, you may have to funds to extend his health insurance.

Hiring and Retention: The benefits an employee receives from his employer for his welfare are often a significant reason why he

decides to accept a job offer. As such, providing employee benefits allow you to compete with other businesses to recruit and

retain qualify employees. If other employers offer better benefits, good employees may choose to go there.

Employees Motivation: By providing a plan that's good for employees' welfare, you show them that you value them. This can

help make them feel welcome and happy in your company, motivating them to work harder. If your health plan has wellness

coverage and preventative care, employees are more likely to stay healthy, cutting down on absenteeism and sick days.

Employees' Well-Being: For companies that have a large base of employees working under stressful conditions or living away

from family, it is important to look at fostering personal happiness and professional growth. Investing in employees pays divi-

dends in terms of higher productivity and greater loyalty

Company Image: Providing a good employee welfare plan reflects well on your business, building a good company image. It may

even earn you some press coverage, giving you free publicity to improve awareness among potential customers. This may boost

your sales and increase your profits.

Features of Employee Welfare -

Employee welfare is a comprehensive term including various services, facilities and amenities provided to employees for their

betterment.

Welfare measures are in addition to regular wages and other economic benefits available to employees under legal provisions

and collective bargaining.

The basic purpose of employee welfare is to improve the lot of the working class and thereby make a worker a good employee

and a happy citizen.

Employee welfare is an essential part of social welfare. It involves adjustment of an employee's work life and family life to the

community or social life.

Welfare measures may be both voluntary and statutory.

How to Develop an Effective Employee Welfare Program

Conduct employee surveys to understand their needs and expectations

Identify key areas of building skills and engagement and facilitating trainings for the same

Propose solutions for personal upkeep, family uplifting and future security

Create opportunities for greater synergies between the management and employees

Conduct impact assessments and feedback surveys

Employee Welfare – Its Benefits and Principles

Employee welfare defines as “efforts to make life worth living for workmen”. “Employee welfare is a comprehensive

term including various services, benefits and facilities offered to employees & by the employers. Through such generous fringe

benefits the employer makes life worth living for employees.”

Welfare includes anything that is done for the comfort and improvement of employees and is provided over and above the

wages. Welfare helps in keeping the morale and motivation of the employees high so as to retain the employees for longer du-

ration. The welfare measures need not be in monetary terms only but in any kind/forms. Employee welfare includes monitoring

of working conditions, creation of industrial harmony through infrastructure for health, industrial relations and insurance

against disease, accident and unemployment for the workers and their families.

Employee welfare entails all those activities of employer which are directed towards providing the employees with certain facili-

ties and services in addition to wages or salaries.

The very logic behind providing welfare schemes is to create efficient, healthy, loyal and satisfied labour force for the organiza-

tion. The purpose of providing such facilities is to make their work life better and also to raise their standard of living.

These efforts have their origin either in some statute formed by the state or in some local custom or in collective agreement or

in the employer’s own initiative:

To give expression to philanthropic and paternalistic feelings.

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To win over employee’s loyalty and increase their morale.

To combat trade unionism and socialist ideas.

To build up stable labour force, to reduce labour turnover and absenteeism.

To develop efficiency and productivity among workers.

To save oneself from heavy taxes on surplus profits.

To earn goodwill and enhance public image.

To reduce the threat of further government intervention.

To make recruitment more effective (because these benefits add to job appeal).

The important benefits of welfare measures can be summarized as follows:

They provide better physical and mental health to workers and thus promote a healthy work environment

Facilities like housing schemes, medical benefits, and education and recreation facilities for workers’ families help in raising

their standards of living. This makes workers to pay more attention towards work and thus increases their productivity.

Employers get stable labour force by providing welfare facilities. Workers take active interest in their jobs and work with a

feeling of involvement and participation.

Employee welfare measures increase the productivity of organization and promote healthy industrial relations thereby main-

taining industrial peace.

The social evils prevalent among the labours such as substance abuse, etc. are reduced to a greater extent by the welfare poli-

cies.

Principles of Employee Welfare Service

Following are generally given as the principles to be followed in setting up a employee welfare service:

The service should satisfy real needs of the workers. This means that the manager must first determine what the employee’s

real needs are with the active participation of workers.

The service should such as can be handled by cafeteria approach. Due to the difference in Sex, age, marital status, number of

children, type of job and the income level of employees there are large differences in their choice of a particular benefit. This

is known as the cafeteria approach. Such an approach individualises the benefit system though it may be difficult to operate

and administer.

The employer should not assume a benevolent posture.

The cost of the service should be calculated and its financing established on a sound basis.

There should be periodical assessment or evaluation of the service and necessary timely on the basis of feedback.

Industrial relations

Industrial relations is a multidisciplinary field that studies the employment relationship. Industrial relations is increasingly being

called employment relations or employee relations because of the importance of non-industrial employment relationships; this

move is sometimes seen as further broadening of the human resource management trend. Indeed, some authors now define

human resource management as synonymous with employee relations. Other authors see employee relations as dealing only

with non-unionized workers, whereas labour relations is seen as dealing with unionized workers. Industrial relations studies ex-

amine various employment situations, not just ones with a unionized workforce. However, according to Bruce E. Kaufman "To a

large degree, most scholars regard trade unionism, collective bargaining and labour-management relations, and the national la-

bour policy and labour law within which they are embedded, as the core subjects of the field."

Initiated in the United States at end of the 19th century, it took off as a field in conjunction with the New Deal. However, it is

generally a separate field of study only in English-speaking countries, having no direct equivalent in continental Europe. In re-

cent times, industrial relations has been in decline as a field, in correlation with the decline in importance of trade unions, and

also with the increasing preference of business schools for the human resource management paradigm.

Overview

Industrial relations has three faces: science building, problem solving, and ethical. In the science building phase, industrial rela-

tions is part of the social sciences, and it seeks to understand the employment relationship and its institutions through high-

quality, rigorous research. In this vein, industrial relations scholarship intersects with scholarship in labour economics, industrial

sociology, labour and social history, human resource management, political science, law, and other areas.

Industrial relations scholarship assumes that labour markets are not perfectly competitive and thus, in contrast to mainstream

economic theory, employers typically have greater bargaining power than employees. Industrial relations scholarship also as-

sumes that there are at least some inherent conflicts of interest between employers and employees (for example, higher wages

versus higher profits) and thus, in contrast to scholarship in human resource management and organizational behaviour, conflict

is seen as a natural part of the employment relationship. Industrial relations scholars therefore frequently study the diverse in-

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stitutional arrangements that characterize and shape the employment relationship—from norms and power structures on the

shop floor, to employee voice mechanisms in the workplace, to collective bargaining arrangements at company, regional, or na-

tional level, to various levels of public policy and labour law regimes, to "varieties of capitalism" (such as corporatism, social

democracy, and neoliberalism).

Theoretical perspectives - Industrial relations scholars have described three major theoretical perspectives or frameworks that

contrast in their understanding and analysis of workplace relations. The three views are generally known as uni-

tary, pluralist and radical. Each offers a particular perception of workplace relations and will therefore interpret such events as

workplace conflict, the role of unions and job regulation differently. The radical perspective is sometimes referred to as the

"conflict model", although this is somewhat ambiguous, as pluralism also tends to see conflict as inherent in workplaces. Radical

theories are strongly identified with Marxist theories, although they are not limited to these.

Pluralist perspective - In pluralism, the organization is perceived as being made up of powerful and divergent sub-groups, each

with its own legitimate loyalties and with their own set of objectives and leaders. In particular, the two predominant sub-groups

in the pluralist perspective are the management and trade unions.

Consequently, the role of management would lean less towards enforcing and controlling and more toward persuasion and co-

ordination. Trade unions are deemed as legitimate representatives of employees, conflict is dealt by collective bargaining and is

viewed not necessarily as a bad thing and, if managed, could in fact be cancelled towards evolution and positive change.

Unitarist perspective - In unitary, the organization is perceived as an integrated and harmonious whole with the ideal of "one

happy family", where management and other members of the staff all share a common purpose, emphasizing mutual coopera-

tion. Furthermore, unitarism has a paternalistic approach where it demands loyalty of all employees, being predominantly man-

agerial in its emphasis and application.

Consequently, trade unions are deemed as unnecessary since the loyalty between employees and organizations are considered

mutually exclusive, where there can't be two sides of industry. Conflict is perceived destructive and result as poor management.

Marxist/Radical perspective - This view of industrial relations looks at the nature of the capitalist society, where there is a fun-

damental division of interest between capital and labour, and sees workplace relations against this background. This perspective

sees inequalities of power and economic wealth as having their roots in the nature of the capitalist economic system. Conflict is

therefore seen as inevitable and trade unions are a natural response of workers to their exploitation by capital. Whilst there

may be periods of acquiescence, the Marxist view would be that institutions of joint regulation would enhance rather than limit

management's position as they presume the continuation of capitalism rather than challenge it.

Industrial relations today - By many accounts, industrial relations today is in crisis. In academia, its traditional positions are

threatened on one side by the dominance of mainstream economics and organizational behaviour, and on the other by post-

modernism. In policy-making circles, the industrial relations emphasis on institutional intervention is trumped by a neoliberal

emphasis on the laissez faire promotion of free markets. In practice, labour unions are declining and fewer companies have in-

dustrial relations functions. The number of academic programs in industrial relations is therefore shrinking, and scholars are

leaving the field for other areas, especially human resource management and organizational behaviour. The importance of

work, however, is stronger than ever, and the lessons of industrial relations remain vital. The challenge for industrial relations is

to re-establish these connections with the broader academic, policy, and business worlds.

Introduction Of Trade-Unions

A trade union is an organization of employees formed on a continuous basis for the purpose of securing diverse range of bene-

fits. It is a continuous association of wage earners for the purpose of maintaining and improving the conditions of their working

lives.

The Trade Union Act 1926 defines a trade union as a combination, whether temporary or permanent, formed primarily for the

purpose of regulating the relations between workmen and employers or between workmen and workmen, or between employ-

ers and employers, or for imposing restrictive condition on the conduct of any trade or business, and includes any federation of

two or more trade unions.

This definition is very exhaustive as it includes associations of both the workers and employers and the federations of their as-

sociations. Here, the relationships that have been talked about are both temporary and permanent.

This means it applies to temporary workers (or contractual employees) as well. Then this definition, primarily, talks about three

relationships. They are the relationships between the:

workmen and workmen, workmen and employers, and employers and employers.

Thus, a trade union can be seen as a group of employees in a particular sector, whose aim is to negotiate with employers over

pay, job security, working hours, etc, using the collective power of its members. In general, a union is there to represent the in-

terests of its members, and may even engage in political activity where legislation affects their members. Trade unions are vol-

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untary associations formed for the pursuit of protecting the common interests of its members and also promote welfare. They

protect the economic, political and social interests of their members.

Features of trade unions:

1. It is an association either of employers or employees or of independent workers. They may consist of :-

o Employers’ association

o General labour unions

o Friendly societies

o Unions of intellectual labour

2. It is formed on a continuous basis. It is a permanent body and not a casual or temporary one. They persist throughout the

year.

3. It is formed to protect and promote all kinds of interests –economic, political and social-of its members. The dominant interest

with which a union is concerned is, however, economic.

4. It achieves its objectives through collective action and group effort. Negotiations and collective bargaining are the tools for ac-

complishing objectives.

5. Trade unions have shown remarkable progress since their inception; moreover, the character of trade unions has also been

changing. In spite of only focusing on the economic benefits of workers, the trade unions are also working towards raising the

status of labours as a part of industry.

The Role of Trade Unions in Industrial Relations

Trade or labour unions have been around since the 1930s to resist through equal bargaining power the domination of employ-

ers over employees and to represent workers’ interests in the employment relationship. It is through union efforts that workers

benefit from better pay and working conditions, and that they are treated with dignity and respect at work. The importance of

trade unions cannot be overstated even though membership has been on a steady decline.

Collective Bargaining - Labour unions developed to grant employees equal bargaining power with their employers, who tradi-

tionally had the ability to exclusively set the terms and conditions of work and pay. Unions represent workers within a given in-

dustry in negotiations with their employers. Since the union comprises a group of workers, it has a greater voice than if employ-

ees were dealing with employers individually. For example, unions are credited with abolishing sweatshops and child labour in

the United States because they pushed for these practices to end. The National Labor Relations Act guarantees employees’ right

to bargain collectively through their chosen labour union representatives. Unions can organize strikes, boycotts, go-slows and

sit-ins to get employers to consider their proposals.

Employee Welfare - Unions have successfully fought for better terms and conditions for workers. They represent workers’ in-

terests and have secured a variety of benefits, such as higher wages for unionized employees, work-life balance characterized by

reasonable work schedules, job security and protection from arbitrary action by employers. In a September 2012 essay on the

CNN website, Democratic strategist Donna Brazil asserted that is also due in part to union activity that discrimination in the

workplace was outlawed and that workers have access to health care, safe working conditions and guaranteed Social Security.

Unions not only have given workers dignity in the workplace, but they also consistently facilitate enhanced welfare and stand-

ards of living for American workers.

Unfair Practices - Labor unions check the unfair labour practices of employers. The NLRA declares that it is unlawful for employ-

ers to dominate a union, discriminate against workers engaged in union activity, and victimize workers who file charges against

them with the National Labor Relations Board or interfere with employees engaged in concerted union activity. If the employer

does any of these prohibited acts, the union can take it up with the board on behalf of the employees. For example, the union

representing Boeing Co. engineers and technical workers filed charges against the company for interfering with employees en-

gaging in concerted union activity. The board investigates charges and may take a variety of actions, including issuance of cease-

and-desist or reinstatement orders to remedy unfair treatment against employees. Unions ensure that employers comply with

the law and can lodge appeals in federal court if employers do not respect board decisions.

Legislation - Unions also play a key role in developing labour laws and regulations for effective worker protection. The unions in-

itiate the push for regulation in areas that concern employees in the workplace. They lobby for the creation of laws and regula-

tions and disseminate information to the employees about them. Measures such as the NLRA, the Social Security Act, the Family

Medical Leave Act and the Occupational Safety and Health Act exist as a result of union efforts for better terms and conditions

for workers. Unions monitor the status of implementation of employee welfare laws and regulations to ensure they are properly

enforced.

Dispute Resolution & Grievance Management

The Dispute Resolution Process

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The dispute resolution process is a participatory and creative process and is required prior to filing a grievance to a decision

maker. By working through a problem-solving process, it increases your satisfaction with the outcome of the complaint process,

helps preserve an ongoing working relationship, and helps open opportunities for future workplace success.

In the complaint process, the dispute resolution officer, as an impartial third party, will consult individually with you and with

your supervisor to gather relevant information, identify both of your issues and interests, and explore options for resolution.

The DRO may consult with management, if needed. A facilitated discussion may be helpful to allow for understanding and deci-

sion making on how to move forward. The DRO is not the decision-maker in the complaint process or an advocate for any party

to the dispute– employee or management.

Grievance Procedure

Once the dispute resolution process is closed, should you not be satisfied with the outcome of the dispute resolution efforts,

then you may pursue the formal grievance procedure. You have ten university business days from the date that the complaint is

closed to file your grievance. Grievances are filed through the Conflict Management and Dispute Resolution Office to the appro-

priate university official as set forth in the Handbook of Operating Procedures, Grievance Policy. The Dispute Resolution Process

and Grievance Procedure Flowchart provides a visual for following the steps in the policy.

The office tracks general information regarding all grievances at the university for the purpose of recommending systemic

changes that may provide better communications and working relationships between employees and management. The griev-

ance and all decisions or responses relating to it shall be a part of the employee's departmental personnel file.

A dispute mechanism is a structured process that addresses disputes or grievances that arise between two or more parties en-

gaged in business, legal, or societal relationships. Dispute mechanisms are used in dispute resolution, and may incorpo-

rate conciliation, conflict resolution, mediation, and negotiation.

Otherwise known as grievance mechanisms, dispute mechanisms are typical non-judicial in nature, meaning that they are not

resolved within the court of law. According to research produced by the non-judicial grievance mechanism task force of John

Ruggie, Special Representative of Business and Human Rights to the United Nations, those who design and oversee non-judicial

mechanisms should acknowledge core human rights processes defined by "all core UN human rights treaties.”

Dispute mechanisms comprise a way for socially responsible businesses to meet requirements of corporate responsibility-

related agreements or pacts, reduce risk while capacity-building or developing internationally, and assist larger processes that

create positive social change.

Dispute mechanisms are an increasingly effective tool for establishing communication channels between businesses and com-

munities. When successful, they offer a trusted way for local peoples or communities to voice and resolve concerns related to

development projects, while providing companies with transparent, effective ways to address community concerns. According

to a publication by the Compliance Advisor/Ombudsman of the World Bank Group, "locally-based grievance resolution mecha-

nism(s) provide a promising avenue by offering a reliable structure and set of approaches where local people and the company

can find effective solutions together." Generally, it is agreed that a well-functioning grievance mechanism should:

Provides a predictable, transparent, and credible process to all parties, resulting in outcomes that are seen as fair, effec-

tive, and lasting

Builds trust as an integral component of broader community relations activities

Enables more systematic identification of emerging issues and trends, facilitating corrective action and pre-emptive en-

gagement.

Characteristics - According to the Business and Human Rights SRSG, such mechanisms must at a minimum be:

Legitimate: a mechanism must have clear, transparent and sufficiently independent governance structures to ensure that no

party to a particular grievance process can interfere with the fair conduct of that process;

Accessible: a mechanism must be publicized to those who may wish to access it and provide adequate assistance for aggrieved

parties who may face barriers to access, including language, literacy, awareness, finance, distance, or fear of reprisal;

Predictable: a mechanism must provide a clear and known procedure with a time frame for each stage and clarity on the types

of process and outcome it can (and cannot) offer, as well as a means of monitoring the implementation of any outcome;

Equitable: a mechanism must ensure that aggrieved parties have reasonable access to sources of information, advice and ex-

pertise necessary to engage in a grievance process on fair and equitable terms;

Rights-compatible: a mechanism must ensure that its outcomes and remedies accord with internationally recognized human

rights standards;

Transparent: a mechanism must provide sufficient transparency of process and outcome to meet the public interest concerns

at stake and should presume transparency wherever possible; non-State mechanisms in particular should be transparent

about the receipt of complaints and the key elements of their outcomes.

Types

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Industry

Company

Legislative

Government

Non-Governmental

Independent State-based

International Organization

Multi-Stakeholder

Uses - Well-designed grievance mechanisms have multiple and sometimes divergent points of application, but are typically used

by monitoring, auditing, project oversight, supply chain management, and stakeholder engagement. Grievance mechanisms can

deal with most kinds of grievances (bar those raising criminal liability), including – but by no means limited to – those that re-

flect substantive human/labour rights concerns. As such, rights-compatible mechanisms must work to integrate human rights

norms and standards into their processes and are based on principles of non-discrimination, equity, accountability, empower-

ment and participation.

Grievance Procedures and Internal Dispute Resolution PRACTICAL TIPS FOR RESOLVING INTERNAL DISPUTES PEACEABLY

Having an internal mechanism for resolving disputes is like wearing a seat belt — the internal restraint can help a nonprofit

avoid harm from a civil lawsuit. Providing an outlet for employees' frustrations at the workplace is a proven safety valve. Rather

than turning a deaf ear to complaints, nonprofits need to provide employees with a credible listener who will also provide an

objective review of their grievance. Employees will feel fairly treated if they have had an opportunity to tell their story, and the

nonprofit has the benefit of learning, outside of litigation, the details of the employee's concerns. Insurance carriers and de-

fense lawyers recommend that every employer have some sort of internal procedure for resolving complaints.

Recent decisions by the U.S. Supreme Court concerning sexual harassment have decreed that when there was a complaint

mechanism at the workplace that the victim did not take advantage of, the employer has an affirmative defense to a lawsuit.

Courts reason that if a plaintiff truly felt harassed, she would have taken advantage of the employer's grievance procedures.

This same reasoning is often used to challenge the credibility of plaintiffs' complaints in other types of employment law actions.

Therefore, not only is having an internal grievance mechanism effective from an employee relations perspective, but it is a basic

risk management strategy which every nonprofit should implement.

There are various types of internal dispute resolution options, ranging from a very formal, binding mandatory arbitration proce-

dure (not permitted in some states, such as Kentucky), to the informal open door policy favored by most mid-sized and small

nonprofits. Some options are:

1. mandatory binding arbitration,

2. a commitment to bring disputes to alternative dispute resolution (ADR), using non-binding arbitration,

3. a formal two- or three-step grievance procedure, with a review committee comprised of various board and staff members,

4. referral of the dispute to an impartial party, who may or may not be connected with the nonprofit, to serve as the arbiter of

disputes,

5. an open door policy, and

6. a peer review committee.

Whatever the mechanism, an internal dispute resolution procedure is helpful because it provides an outlet for employees' con-

cerns. A grievance or complaint procedure gives the employee his "day in court" and can be helpful for the nonprofit's man-

agement because misunderstandings or unhealthy disputes between staff may be uncovered and addressed before the conflicts

spin out of control. Serious concerns, such as sexual harassment between co-workers, can be uncovered and addressed by the

nonprofit before a lawsuit is filed. The goal of internal dispute resolution is to solve the problems at the lowest level possible, so

that workplace disputes don't escalate into legal actions. It is important that whatever internal dispute resolution procedures

the nonprofit uses provide that employees who use the process will not be retaliated against.

Alternative Dispute Resolution - Increasingly employers, including those in the nonprofit sector, are using agreements to re-

quire employees to resolve any future dispute using alternative dispute resolution methods (ADR) rather than proceed directly

to court. This requirement is an effort to avoid the large expenses involved with litigating employment law cases. There are al-

ternative dispute resolution firms that provide mediation and arbitration services to address employment related disputes. The

advantage of agreements to go to a mediator or arbitrator is that the nonprofit and employee agree, through a written com-

mitment, to submit any future disputes to alternative dispute resolution proceedings. Generally the agreement also addresses

who will pay the costs for such proceedings. Before setting a policy for mediation or arbitration, check with your insurance

agent. It is likely that alternative dispute resolution costs will be covered under your employment practices liability coverage.

However, due to the variation in policy forms, confirm the coverage with your insurance agent. If the policy does not provide

coverage for alternative dispute resolution, it may be available by purchasing an endorsement.

Formal Written Grievance Procedure - Another way to increase the likelihood that workplace disputes will be raised internally

in a timely fashion is to implement a formal grievance policy. The basic elements of a written grievance procedure are:

A requirement that employees utilize the grievance procedure by submitting their disputes or complaints to the nonprofit in a

timely fashion;

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A statement of how complaints are submitted (usually in writing) and to whom (usually there is a choice of two people so that

if one of the identified persons makes the complainant uncomfortable, the other is still an option);

Identification of who will review the complaints and make the determination;

A statement that retaliation against any employee who brings a complaint is prohibited and will subject the retaliator to disci-

pline up to and including discharge; and

A statement that the nonprofit will report back to the complaining party, and that the nonprofit's decision is final.

The resolution of an internal grievance procedure is not binding in most cases. Therefore, if an employee is dissatisfied with the

final determination of the internal grievance procedure, the employee can still hire a lawyer and file a lawsuit. However, this risk

is greatly reduced in cases where the employee already had "his day in court" internally. Moreover, the nonprofit will be aware

of the concerns by that point, and should have all its ducks in order to effectively defend the claims.

Advantages of an "Ombudsperson" - In order for internal grievance procedures to be a success, the panel or individuals who

review the grievance must have the respect of the staff and must be perceived as neutral, unbiased, and credible. Sometimes

hiring an outside person to serve as "ombudsperson"* is an effective method of preserving credibility and objectivity. Appoint-

ing an internal ombudsperson from a different division or department might also be an option. The ombudsperson could be se-

lected on a permanent basis, or case by case, as the need arises. The ombudsperson reviews the concern(s), interviews the

complainant(s), and issues a determination to the nonprofit's management or board. When confidentiality is a major concern,

an outside consultant or alternative dispute resolution firm is particularly effective serving as the ombudsperson. If well-

executed, employees will respect the results, which are not binding on the employee or the nonprofit.

*The term ombudsperson has various meanings in different workplace settings. We use it here to connote an objective third par-

ty charged with hearing and resolving internal disputes.

Open Door Policy - An open door policy implies that when employees have a concern they should first approach their supervi-

sor for an informal discussion and attempt at resolution, and if not satisfied, should write a formal complaint which their super-

visor is obligated to take to the next level of management. Often a policy will spell out the time frames for employee complaints

and for the nonprofit's responses.

Generally it is best to stay flexible with timeframes. Unforeseen circumstances may prevent the nonprofit from responding

within the given time frame. Nevertheless, it is best to respond as quickly as possible to any employee complaint. To cover situ-

ations when the employee is not satisfied with the response of a supervisor to a stated concern, many nonprofits permit an ap-

peal to a progressively higher level of management, sometimes including the board of directors in the dispute resolution pro-

cess.

"An open door policy implies that when employees have a concern they should first approach their supervisor for an informal

discussion and attempt at resolution, and if not satisfied, should write a formal complaint which their supervisor is obligated to

take to the next level of management."

Alternatively, if the nonprofit does not wish to involve board members in internal squabbles, the executive director can serve as

the final arbiter. The advantage of an open door policy is that the nonprofit has numerous opportunities to self-check, to ensure

that its policies were followed, and to correct any deficiencies before a potentially hostile review by external eyes.

Peer Review Boards - Another method of internal dispute resolution is referral of the dispute to a peer review board comprised

of a panel of employees who consider the dispute or complaint and determine the outcome. Often the panel will need to be

trained by an outside consultant. Those on the panel need to respect the confidentiality of all employees who come before the

review board. The nonprofit can limit the authority of the panel to disputes involving only certain types of discipline or particu-

lar policy violations and in this way can combine a peer review panel with other methods of internal dispute resolution. In cer-

tain workplaces where there is already a great deal of trust, a peer review panel can be extremely effective.

Employee Complaint? - Whatever the method used, the secret to success is to respond immediately to an employee's com-

plaint. While the nonprofit's written policy should require employees to put their complaints in writing, if a supervisor merely

hears about an employee's complaint, the supervisor should remind the employee that no retaliation may be taken against the

employee and encourage the employee to put the complaint in writing for further review and investigation.

Red Flag! No Retaliation! - Nonprofits need to be aware that in many instances it is illegal for an employer to retaliate against

an employee who files a complaint with either government offices or internally.

In some states, notably New Jersey, employees are protected by state "whistleblowing" laws for reporting that a co-worker was

engaging in illegal or unethical practices, although generally such laws only cover the employer's actions.

Therefore, make sure that if an employee has filed a complaint that disciplinary action taken by the employer against that em-

ployee is clearly documented to show that the reason for the discipline is unrelated to the complaint filed by the employee.

Definition of Employee Empowerment

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Employee empowerment is giving employees a certain degree of autonomy and responsibility for decision-making regarding

their specific organizational tasks. It allows decisions to be made at the lower levels of an organization where employees have a

unique view of the issues and problems facing the organization at a certain level.

Theoretical Approaches to Empowerment

Three theoretical approaches have been used to study empowerment: socio-structural perspective, psychological approach, and

the critical perspective. The socio-structural perspective focuses its attention on developing or redesigning organizational polic-

es, practices, and structures to give employees power, authority, and influence over their work. The psychological ap-

proach focuses on enhancing and enabling personal effectiveness by helping employees develop their sense of meaning, com-

petency, self-determination, and impact. The critical perspective challenges the notion of employee empowerment and argues

that efforts to create empowerment may actually lead to more, albeit less-obvious, controls over employees.

Advantages to Employee Empowerment - Employee empowerment provides some distinct advantages. Employee empower-

ment should lead to increased organizational responsiveness to issues and problems. Another advantage of employee empow-

erment should be an increase in productivity. It should also lead to a greater degree of employee commitment to organizational

goals since employees can take some degree of ownership in the decisions made toward goal achievement.

Disadvantages to Employee Empowerment - Employee empowerment is not without some disadvantages. It can lead to de-

creased efficiency because decisions may not be uniform and optimized for organizational goals. It can also create problems

with coordination throughout the organization because decisions are decentralized and not managed at the top. Manager and

employee relationships can become tense as the boundaries of authority can be blurred. Finally, according to the critical per-

spective, attempts at employee empowerment can be counterproductive, actually creating greater controls over employees.

For example, empowering employees through the use of teams may create peer pressure.

To unlock this lesson you must be a Study.com Member.

Employee empowerment has been defined in many ways but generally means the process of allowing employees to have input

and control over their work, and the ability to openly share suggestions and ideas about their work and the organization as a

whole. Empowered employees are committed, loyal and conscientious. They are eager to share ideas and can serve as strong

ambassadors for their organizations.

Improve Productivity - Reduce Costs - John Zink of the PHCC Educational Foundation says that employees have great ideas

about how to improve productivity and reduce costs, but companies need to know how to ask for these ideas and listen. "Some-

times it takes an employee stepping outside of their authority to show the benefits of employee empowerment an owner," he

says. Employees who feel confident that their input will be valued, listened to and acted upon will be more likely to share those

ideas, benefiting employee and employer.

Better Customer Service - Simon Sinek, a blogger who writes "The Empowered Employee", says that empowered employees

provide exceptional service and he's experienced this first-hand. "Empowered employees have the power to make decisions

without a supervisor. They are entitled to go off script, bend the rules, do what they see fit if they believe it is the right thing to

do for the customer. More than any other kind of employee, the empowered employee is able to create a feeling of true cus-

tomer service that ultimately yields much greater customer loyalty," he says. Companies that give employees the freedom to

make decisions on the spur of the moment, that may even sometimes fly in the face of established rules and protocol, often find

that service to internal and external customers is improved. In addition, empowered employees take pride and ownership in

their jobs when they know that they can exercise independent judgment when necessary.

Embracing Change - Empowered employees feel free to challenge the status quo, which is critical for companies in today's fast-

changing, technology-driven environment, says Lin Grensing-Pophal, author of "Human Resource Essentials". Employees and

the companies they work for can become too complacent, doing things the way they've always done them. Unless employees

feel comfortable questioning the status quo, those companies are likely to stagnant as competitors move swiftly past them. Es-

tablishing an environment when employees feel free to question, challenge and offer new ideas can help to avoid this problem

and benefit employees and employers in the process, says Grensing-Pophal

6 Main Importance of Empowerment in an Organisations in Recent Years

i) The increasing pace of change, turbulence of the environment, and the speed of competitive response and the acceleration of

customer demands require a speed and flexibility of response which is incompatible with the old-style command and control

model of organisational functioning.

ii) Organisations themselves are changing. The impact of downsizing, de-layering and decentralising means that the old methods

of achieving co-ordination and control are no longer appropriate. Achieving performance in these new circumstances requires

that staff take and exercise much greater responsibility.

iii) Organisations require more cross-functional working, more cooperation between areas, and more integration in their pro-

cesses if they are to meet the customers’ needs. Such co-operation can be achieved through empowerment.

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iv) Excellent managerial talent is increasingly perceived as scarce and expensive. Using it for direct supervision of efficient staff

compounds these difficulties. On the other hand, empowerment enables managerial talent to be focused more on external

changes and less on internal problem-solving.

v) Empowerment may reveal sources of managerial talent, which were previously unrecognised, and creating circumstances in

which such talent can flourish.

vi) Staff is no longer prepared to accept the old command and control systems. Much wider availability of education, greater

emphasis on lifetime development and the end of the previous certainities of job security and steady advancement have con-

tributed to a situation where jobs are valued for the development of opportunities that they offer, rather than in themselves.

Organisations which fail to meet these aspirations will not generate the performance they require and will suffer a continuous

drain of their best staff.