HR Management.doc

8/9/2019 HR Management.doc

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MODULE HUMAN RESOURCE MANAGEMENT

TABLE OF CONTENTS

1. Strategic Role of Hua! Re"ource Ma!agee!t#########$

$. %o& A!al'"i" a!( De"ig!#####################1)

*. +er"o!!el +la!!i!g a!( Recruiti!g###############.$*

). E,lo'ee Te"ti!g a!( Selectio!#################$-

. Orie!tatio! a!( +lacee!t###################..**

/. +erfora!ce A,,rai"al a!( Ma!agee!t############.*-

-. E,lo'ee Reu!eratio!#####################)0

0. Trai!i!g a!( Deelo,e!t####################*

2. La&our La3"###########################./4


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Mo(ule 15 Strategic role of Hua! re"ource a!agee!t

Objectives

Upon completion of this module you would be able to understand the following:

1. Why is HR management important to all managers?

2. The strategic challenges of HR

. The strategic management process

!. Translating strategy into HR policies and practices

". HR #core card approach

O,e!i!g Ca"e

Tata $onsulting ser%ices &T$#' is a truly global company. (t has 2)*+++ software

engineers drawn from 2 countries. T$# adopts uni,ue system of hiring people.

(ts starts its human resource sourcing right at the college le%el. The software

2

What Is the strategic role of

HRM?Objective 1: Describe the strategic role thatHRM plays

Why is HRM important to Managers?

Strategic challenges in HR

Strategic Management rocess

HR Scorecar! "pproach

#enefits of HR Scorecar! Metrics


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leader sends more than "+ senior e-ecuti%es to interact with academic

institutions. t these institutions* T$# funds many e%ents li/e conferences*

seminars* gets in%ol%ed in impro%ing curricula* establishing fellowships and

e-changes e-pertise through %isiting faculty programmes. To top all these is the

annual retreat with o%er hundred top academics in Thiru%ananthapuram* the

training hub of T$#.

T$# e-tends its relationships to se%eral uni%ersities abroad as well. (t has

sponsored pro0ects at (T* Har%ard and ellogg school and institutions in 3apan*

ustralia* $hina and #ingapore. ll the spade wor/ being done* T$# finds it easy

to hire the best talent in campus recruitments.

Welcome to the e-citing and challenging field of Human Resource management4

Mea!i!g a!( (efi!itio!5

5efore ,uoting the definition it is essential for us to understand the following:

1. 6rgani7ations are not mere bric/s* machines and in%entories. They are people.

(t is people who staff and manage the organi7ation.

2. (t in%ol%es the application of management functions and principles. The

principles are applied in ac,uisitioning* de%eloping* maintaining* and

remunerating employees in organi7ation.

. 8ecisions made must influence the effecti%eness of the organi7ation.

!. HR functions are not 0ust limited to business establishments only. They are

applicable to 96;s*


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67' i" HR a!agee!t i,orta!t to all a!ager"8

This is easily understood by personnel mista/es you don;t want to ma/e while

managing. =or e-ample* you don;t want to:

Hire wrong person for the 0ob

Where are we now as a

business and where do we want to be? The manager then formulates specific

strategies to ta/e the company from where it is now to where he or she wants it

to be. "trateg'is thus a course of action. The company;s %arious strategies

HR;s* #ales* production etc need to support the company;s strategic plan.

#uppose the strategic plan calls for impro%ing ,uality of the company;s products.

Then one of HR strategy might be to >boost employee ,uality consciousness

through impro%ed screening and training.@

E9a,le5

The essence of 8ell computer;s strategic plan has always been to be what

strategic planner call a >lowAcost leader*@ by using the internet and phone to sell

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B$s directly to end users at prices competitors cannot match. The firms HR

managers ha%e de%ised %arious HR strategies to support the firm;s lowAcost

strategy. =or e-ample* 8ell now deli%ers most of its HR ser%ices %ia the web.

manager;s tool section on intranet contains about + automated web

applications. This allows managers to perform HR tas/s that pre%iously re,uired

costly participation by HR department personnel. The intranet also lets 8ell

employees administer their own plans* chec/ 0ob postings and monitor the total

compensation statements. This dramatically reduces the number of HR people

re,uired to administer these acti%ities and thus cost of doing so.

(n formulating HR strategies the HR managers must address three basic

challenges.

1. T7e !ee( to "u,,ort cor,orate ,ro(uctiit' a!( ,erfora!ce

i,roee!t effort".

With the globali7ation of the world economy* competition has increased* and

with it need to continually impro%e the organi7ation;s performance.

$. T7e e,lo'ee" ,la' a! e9,a!(e( role i! t7e e,lo'er:" ,erfora!ce

i,roee!t effort".

This re,uires high le%el of employee competence and commitment.

*. T7e HR De,arte!t u"t &e ore i!ole( i! (e"ig!i!g !ot ;u"t

e9ecuti!g t7e co,a!':" "trategic ,la!.

(n formulating the strategy the top management needs the input of the

managers charged with hiring* training and compensating the firm;s employees.

HR professionals therefore need to understand the basic strategic planning.

T7e "trategic a!agee!t ,roce""

=igure 1.1 below gi%es the idea of what strategic management process. #trategic

planning is the part of the firm;s strategic management process.

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(t consists of se%eral related tas/s. Cets loo/ at at the main ones.

#tep1: Defi!e t7e &u"i!e"" a!( it" i""io!5

The fundamental strategic decision managers face are these: >where are we

now in terms pf the business we;re in* and what business do we want to be in*

gi%en our company;s opportunities and threats* and its strengths and

wea/nesses?@ angers then choose strategies course of action such as buying

competitors or e-panding o%erseas to get company from where it is today to

where it wants it to be tomorrow.

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anagement e-perts use the terms %ision and mission to help define the

company;s current and future business.

The company;s Dision is a >general statement of its intended direction that

e%o/es emotional feelings in organi7ation members.@

The firm;s mission is more specific and shorter term. (t >ser%es to communicate E

who we are* what we do* and where we are headed;.@

#tep 2: +erfor e9ter!al a!( i!ter!al au(it"5

anagers base their strategic plans on methodical analyses of their e-ternal

and internal situation. The basic point of strategic plan should be to choose a

direction for the firm that ma/es sense* in terms of the e-ternal opportunities

and threats it faces and the internal strengths and wea/nesses it possesses.

(deally managers begin their strategic planning by methodically analy7ing their

e-ternal and internal situations. The strategic plan should pro%ide a direction for

the firm that ma/es sense* in terms of the e-ternal opportunities and threats the

firm faces and the internal strengths and wea/nesses it possess. To facilitate this

strategic e-ternalFinternal audit many managers use #W6T analysis. This

in%ol%es using a #W6T chart to compile and organi7e the process of identifying

company #trengths* Wea/nesses* 6pportunities* and Threats.

#tep 5 Tra!"late i""io!" i!to "trategic goal"5

The firm;s managers need longAterm strategic goals. =or e-ample* what e-actly

does that mission mean* for the ne-t fi%e years* in terms of how many and what

specific types of partnership to form* with whom and when?

#aying the mission is to ma/e ,uality 0ob one is one thing operating that mission

for your managers is another. What e-actly does that mission mean* or each

department* in terms of how we;ll boost ,uality?

s an e-ample* Web8;s sales director needs goals regarding the number of

new medical related content pro%iders %itamin forms* hospitals* H6s it must

sign up per year* as well as sales re%enue targets. The business de%elopment

managers needs goals regarding the number of new businesses such as using

Web8 to help manage doctors; office online he or she is to de%elop and sign.

#imilarly* $iticorp can;t function solely with a mission* pro%ide integrated*

comprehensi%e financial ser%ices worldwide. To guide managerial action* it needs

goals in terms of things li/e building shareholder %alue* maintaining superior

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rates of return* building a string balance sheet and balancing the business by

customer* product and geography.

#tep ! : Forulate a "trateg' to ac7iee t7e "trategic goal"5

The firms strategy is a bridge connecting where the company is today with

where it wants to be tomorrow. The ,uestion is >how do we get from here to

there?@ strategy is a course of action. (t shows how the enterprise will from

the business it is in now to the business it wants to be* gi%en its opportunities

and threats and its internal strengths and wea/nesses. /nowledge of and

commitment to the strategy helps ensure that employees ma/e decisions

consistent with the company;s needs.

gain a strategy is a course of action. (t shows how the enterprise will mo%e

from the business it is in now to the business it wants to be in &as laid out by its

%ision* mission* and strategic goals' gi%en the firm;s opportunities* threats*

strengths* and wea/nesses. The strategies bridge where the company is now*

with where it wants to be tomorrow. The best strategies are concise enough for

the manager to e-press in an easily communicated phrase that resonates with

employees.

=or e-ample*

Co,a!' Strategic +ri!ci,le

8ell 5e direct

e5ay =ocus on trading communities

eneral


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e-ecuti%e team;s shared understanding of 9o/ia;s strategy reportedly helps

e-plain how the form can ma/e thousands of decisions each wee/ so coherently.

#tep ":


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anagement formulates a strategic plan. That strategic plan implies certain wor/

force re,uirements* in terms of employee s/ills* attributes and beha%iors that HR

must deli%er to enable the business to achie%e the strategic goals.

=or


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=ig 1.2 The se%en step process in HR scorecard approach. #ource ary 8essler

#tep 15 Defi!e t7e Bu"i!e"" "trateg'A $reating a strategy oriented HR system

starts by defining what the company;s strategic plans are. (deally senior HR

leaders; insights regarding the human resources in their own company and in

those of the competition pro%ide %aluable planning input.

Toward the end of this stage the management translates its broad strategic

plans into specific* actionable strategic goals.

#tep 2: Outli!e t7e co,a!':" alue c7ai!A to achie%e its strategic goals*

any business must engage in certain strategically re,uired acti%ities.


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=or this %alue chain analysis is useful. The company;s %alue chain Eidentifies the

primary acti%ities that create %alue for customers and the related support

acti%ities;.

Cets refer to =ig 1. which demonstrates a sample %alue chain for a Hotel:

=ig 1. n e-ample of a Hotel;s %alue chain#ource:ary 8essler* Bh.8.

We can thin/ of any business as consisting of a chain of crucial acti%ities.


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i"uali>i!g= a!( a!al'>i!g fir:" o"t i,orta!t actiitie" a!( "trategic

co"t".

Dalue chain analysis is more than 0ust a tool for identifying the ways things are

done now. (t prompts ,uestions such as: >How do our costs for this acti%ity

compare with our competitors?; Eis there some way we can gain a competiti%e

ad%antage with this acti%ity?; >(s there a more efficient way for us to deli%er

these ser%ices?; nd* >86 we ha%e to perform these ser%ices inAhouse?@.

6utlining and analy7ing the company;s %alue chain can also help the HR

manager create an HR system that ma/es sense in terms of the firms; strategy.

=or


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Ste, )5


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,uantitati%ely. They ma/e it clear whether and to what e-tent employee morale

is up or down.

#econd* they can help HR manager to build a measurable and persuasi%e

business case for how HR contributes to achie%ing the company;s strategic

financial goals. The manager will be able to show* ,uantitati%ely* how the firm;s

HR acti%ities affect employee beha%iour* customer satisfaction and therefore

fiancial performance.

The HR scorecard is crucial in this measurement process. (t helps the HR

manager demonstrate how HR contributes to the company;s strategic and

financial success.

Ste, -5 +erio(icall' ealuate t7e ea"uree!t "'"te The HR manager

cannot assume that the HR scorecard;s %arious measures and lin/s will always

stay the same. He or she should periodically e%aluate measures and lin/s to

ma/e sure they are still %alid.

E9erci"e5

The Hotel Baris (nternational: n e-ample

Cet us see how this se%en step process wor/s by considering a fictitious

company* The Hotel Baris international. Cet us say this Baris based hotel has a

global e-pansion plan to stay competiti%e in the mar/et. (n doing so they belie%e

that it will let them capitali7e on their reputation for good ser%ice* by pro%iding

multiAcity alternati%es for their satisfied guests. The problem is* their reputation

for good ser%ices has been deteriorating. (f they cannot impro%e the ser%ice* it

would be unwise for them to e-pand* since their guests might actually prefer

other hotels after trying the Hotel Baris.


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Transparency is such a crucial element for any organi7ation. Those

organi7ations who don;t %alue transparency they get failed shortly.

Howe%er those companies who loo/ after their organi7ational

transparency they get succeeded %ery soon. The Human Resource

&HR' managers can efficiently chec/ the le%el of their employee

transparency by using hr scorecard metrics.

2. To Mea"ure t7e olue of Sale"

#ales ratio defines either growth or deficiency of the organi7ation. With

the aid of HR scorecard metrics* HR managers can easily calculate the

sales %olumes of their companies.

. To Calculate t7e Retur!" of t7e Orga!i>atio!

Returns are %ery important for all types of businesses and

organi7ations. With the support of HR scorecard metrics* the human

resource managers can efficiently asses the returns of their

companies.

!. To Mea"ure t7e Leel of Orga!i>atio!al +ro(uctiit'

nother important usage of HR scorecard metrics is to measure the

organi7ational producti%ity. Therefore the HR managers should not

o%erloo/ these software applications as these would impro%e the

performance of human resource department efficiently.

". To


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=ig 1.! #olution to Hotel Baris e-ample source ary 8essler

=ig 1.! shows an e-ample of an HR #corecard approach

18

$ob "nalysis an! Design

Objective %: &earn ho' to con!(ct

$ob Description

$ob Specification


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%o& A!al'"i" a!( (e"ig!

The main purpose of this chapter is to show how to analy7e a 0ob and write 0ob

descriptions. s those wor/ing in recruiting and hiring industry it is essential

for one to /now 0ob analysis to ensure appropriate candidate is recruited for

the right position.

What is Job analysis?

8efinition: J3ob analysis is the process of studying and collecting information

relating to the operations and responsibilities of a specific 3ob. The immediate

products of this analysis are 0ob descriptions and 3ob specifications.

5y definition we see the process of 3ob analysis results in two sets of data:

1. 3ob description and 2.3ob specification. =igure below gi%es the difference

between the two.

%o& A!al'"i"

process of obtaining all pertinent 0ob facts

%o& (e"cri,tio!

statement containing items such

as:

3ob title

Cocation

3ob summary

8uties

achine tools* and e,uipment

aterials and forms used

#uper%ision gi%en or recei%ed

Wor/ing conditions

Ha7ards

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%o& S,ecificatio!

statement of human ,ualifications necessary to

8o the 3ob. Usually contains such items as


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T7e ,roce"" of %o& a!al'"i"

=ig below illustrates the process of 3ob analysis.

1.#trategic choices

K

K

2.ather information

K

K

.Brocess information

K

K

!.3ob descritptionK

K

". 3ob specification

Cets understand these steps in much more detail.

1. Strategic c7oice"

With regard to 3ob analysis at least fi%e choices are made:

a.


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$are should be ta/en as we gather information from the employee as he or she may

inflate their duties and responsibilities of hisFher 0ob ma/ing it more important than it

actually is.

6n the other hand lac/ of in%ol%ement from employees may lead to inaccurate and

incomplete information.

While in%ol%ing employees in 3ob analysis they should be communicated why the

analysis is being conducted. &=urther training* recruiting more employees* additional

responsibilities J'

&. Leel of (etail"

The nature of the 0ob being analy7ed determines the le%el of detail in 3ob analysis.

=or


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(. +a"t orie!te( " Future orie!te(

(f an organi7ation is changing rapidly due to fast growth or technological change* a more

future oriented approach to 0ob analysis may be desired.

=or e-ample personal computers began to replace electronic typewriters* thus changing

character of many typist 0obs. any companies anticipated these changes and began

retraining their typists before changing o%er to personal computers.

e. Source" of %o& (ata

No!7ua! "ource" Hua! "ource"

1. What type of data is to be collected?

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2. What methods are to be employed for data collection?

. Who should collect the data?

=ollowing table brings out the elements to be gathered for a gi%en 3ob. The type of data*

howe%er* depends upon the end use of the information* as also on the time and budget

constraints.

Ta&le5 T',e" of %o& a!al'"i" i!foratio!

1. Wor/ cti%ities

a. 8escritpion of wor/ acti%ities&tas/s'

&i' how is a tas/ performed?

&ii' Why is a tas/ performed?

&iii' When is the tas/ performed?

b. (nterface with other 0obs and e,uipment

c. Brocedures used

d. 5eha%iour re,uired on the 0obs

e. Bhysical mo%ements and demands of the 0obs.

2. achines* tools* e,uipment and wor/ ids used

a. Cist of machines* tools* etc used

b. aterials processed with items listed in 2&a'

c. Broducts made with items listed in 2&a'

d. #er%ices rendered with items listed in 2&a'

. 3ob conte-t

a. Bhysical wor/ing conditions

1.


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d. Bhysical characteristics &=itness re,uirements for the 0ob'

e. ptitudes and s/ills

The most prominent methods by which data collection done are

a. 6bser%ation

b. (nter%iew

c. Luestionnaire

d. $hec/lists

e. Technical conference

f. 8iary methods.

*.

fter information is gathered it needs to be processed so that it would be useful in

%arious personal functions.&Berformance appraisal* hiring* promotions* transfersJ'. The

processed information is useful to prepare 0ob description and 0ob specification.

). %o& De"cri,tio!

0ob description is a written statement of what the wor/er actually does* how he or she

does it and what the 0ob;s wor/ing conditions are. This information is further used to

write a 0ob specificationI this lists the /nowledge* abilities and s/ills re,uired to perform

the 0ob satisfactorily.

There is no standard format for writing a 0ob description. Howe%er they usually contain

the following:

a. 3ob identification

b. 3ob summary

c. Responsibilities and duties

d. uthority of incumbent

e. #tandards of performance

f. Wor/ing conditions

g. 3ob specifications

Sa,le %o& De"cri,tio!

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3ob Title: 3ob $ode:

Recommended #alary rade


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4tili+e the Internet for recr(itment,

22ost positions to appropriate Internet so(rces,

22Improve the company 'ebsite recr(iting page to assist in recr(iting,22Research ne' 'ays of (sing the Internet for recr(itment,

224se social an! professional net'or0ing sites to i!entify an! so(rce can!i!ates,

Netor! "hrough #ndustry $ontacts% &ssociation 'emberships% "rade (roups and Employees

&ocate an! !oc(ment 'here to fin! i!eal can!i!ates,

"i! p(blic relations in establishing a recogni+able 5employer of choice6 rep(tation for the

company- both internally an! e.ternally,

*omm(nicate 'ith managers an! employees reg(larly to establish rapport- ga(ge morale-

an! so(rce ne' can!i!ate lea!s,

*reate contacts 'ithin in!(stry,

"tten! local professional meetings an! membership !evelopment meetings,

Maintain reg(lar contact 'ith possible f(t(re can!i!ates,

$oordinate and #mplement $ollege Recruiting #nitiatives

*oor!inate college recr(iting initiatives,

"tten! career fairs for recr(iting an! company recognition,

Develop 'or0ing relationships 'ithin colleges to ai! in recr(iting,

7ive presentations at colleges- atten! st(!ent gro(p meetings- an! increase college

a'areness of the company before an! after career fairs,

&dministrative Duties and Record )eeping

Manage the (se of recr(iters an! hea!h(nters,

Revie' applicants to eval(ate if they meet the position re3(irements,

*on!(ct prescreening intervie's

Maintain all pertinent applicant an! intervie' !ata in the H(man Reso(rces Information

System 8HRIS9

"ssist in performing reference an! bac0gro(n! chec0s for potential employees,

"ssist in 'riting an! for'ar!ing rejection letters,

"ssist in intervie'ing an! selecting employees onsite,

"ssist in preparing an! sen!ing offer pac0ages,

"ssist in preparing an! sen!ing ne' employee orientation pac0ages,

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erform other special projects as assigne!,

Re*uired )noledge% +!ills and &bilities:

)o perform this job s(ccessf(lly- an in!ivi!(al m(st be able to perform each essential !(ty

satisfactorily- as assigne!, )he re3(irements liste! belo' are representative of the 0no'le!ge- s0ill-

an! ability re3(ire!, Reasonable accommo!ations may be ma!e to enable in!ivi!(als 'ith !isabilities

to perform the essential f(nctions,

.perience 'ith recr(iting- technical recr(iting a pl(s,

roven can!i!ate so(rcing an! relationship b(il!ing s0ills,

.cellent comp(ter s0ills in a Microsoft Win!o's environment,

ffective oral an! 'ritten comm(nication s0ills,

7eneral 0no'le!ge of vario(s employment la's an! practices,

.cellent interpersonal an! coaching s0ills,

"bility to 'or0 'ith vario(s !epartments an! foster team'or0,

"bility to 'or0 in!epen!ently 'ith minimal s(pervision,

S0ills in !atabase management an! recor! 0eeping,

"bility to maintain the highly confi!ential nat(re of h(man reso(rces 'or0,

"bility to travel for recr(itment meetings- college visits- an! career fairs an! maintain a

fle.ible 'or0 sche!(le,

.cellent organi+ational s0ills,

M(st be able to i!entify an! resolve problems in a timely manner,

7ather an! analy+e information s0illf(lly,

Demonstrate reso(rcef(lness an! initiative in !ealing 'ith !aily ass(mptions,

Education and Experience:

" bachelors !egree is re3(ire!,

One to t'o years of h(man reso(rces e.perience re3(ire!; one to t'o years of h(man

reso(rces corporate recr(iting e.perience preferre!,

rofessional in H(man Reso(rces 8HR9 certification preferre!,

Physical Demands:

)he physical !eman!s !escribe! here are representative of those that m(st be met by an employee

to s(ccessf(lly perform the essential f(nctions of the job, Reasonable accommo!ations may be ma!e

to enable in!ivi!(als 'ith !isabilities to perform the essential f(nctions, While performing the !(ties of

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this job- the employee is reg(larly re3(ire! to see- tal0 an! hear, )he employee fre3(ently is re3(ire!

to sit an! (se han!s along 'ith fingers- to han!le or feel, )he employee is occasionally re3(ire! to

stan!- 'al0- reach 'ith han!s an! arms- climb or balance- an! stoop- 0neel- cro(ch or cra'l, )he

employee m(st fre3(ently lift an! po(n!s, Specific vision abilities re3(ire! by this

job incl(!e close vision,

,or! Environment:

)he 'or0 environment characteristics !escribe! here are representative of those enco(ntere! 'hile

performing the essential f(nctions of this job, Reasonable accommo!ations may be ma!e to enable

in!ivi!(als 'ith !isabilities to perform the essential f(nctions, While performing the !(ties of this job-

the employee is occasionally e.pose! to moving mechanical parts an! vehicles, )he noise level in

the 'or0 environment is (s(ally mo!erate,

)his job !escription is inten!e! to convey information essential to (n!erstan!ing the scope of the

position an! is not an e.ha(stive list of s0ills- efforts- !(ties- responsibilities or 'or0ing con!itions

associate! 'ith it,

1. Wor/ing indi%idually or in groups* obtain copies of 0ob description for clerical

position at the college or uni%ersity where you study or the firm where you wor/.

What types of information do they contain? 8o they gi%e you enough informationto e-plain what the 0ob in%ol%es and how to do it? How would you impro%e on

the description?

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+er"o!!el +la!!i!g a!( recruiti!g

Bersonnel planning is the first step in recruiting and selection process. =ollowing steps

are in%ol%ed in this process to select the best candidate for the 0ob:

1. 8ecide what positions you;ll ha%e to fill through personnel planning and

forecasting.

2. 5uild a pool of candidates for these 0obs by recruiting internal and e-ternal

candidates

. Ha%e candidates complete application forms and perhaps undergo an initialscreening inter%iew.

!. Use selection techni,ues li/e tests* bac/ground in%estigations and physical

e-ams to identify right candidates.

". 8ecide who to ma/e an offer to* by ha%ing the super%isor and perhaps others on

the team inter%iew the candidates.

The need or importance of manpower planning may be assessed through the

following facts:

i e of t7e &u"i!e""5 Wit the e-pansion of the plant* a

large number of wor/ers are re,uired to be recruited. t the time of ta/ing the

decision for e-pansion of he plant* a stoc/ of the e-isting manpower should be

ta/en and future need of the personnel should be assessed. Ti sis %ery essential

to /now whether new responsibilities should be assigned from among the

e-isting personnel or personnel should be recruited afresh outside to met the

challenges of the new responsibilities.

31

ersonnel lanning an! Recr(iting

Objective-: 4n!erstan! the process ofrecr(iting an! selection,

ffective Recr(iting

Hiring .ternally

Developing an! (sing application form


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ii Effectie recruite!t a! "electio! ,olic' 5 =uture need may be

predicted by manpower planning* hence only right man on the right 0ob at the

right time may be recruited and selected. The enterprise is not to in%est much

amount on the training of such wor/ers who are recruited and placed after

proper scrutiny. The rate of labour turno%er is also reduced by an effecti%e

manpower planning.

iii Re(uctio! i! la&our co"t5 (n order to maintain the supremacy o%er other

competiti%e firms* it is in the interest of eh organi7ation to control the cost of

labour by effecti%e use of manpower and thus reducing the wastage. This can be

well done by manpower planning.

i Aoi(i!g (i"ru,tio! i! ,ro(uctio! 5 anpower planning may help the

organisation procuring the s/illed and ,ualified wor/ers because future needs of

personnel may be estimated before hand and they are recruited and trained on

the basis of a well de%eloped recruitment and training policy thus lowering the

amount of e-penditure on training. The production is carried on uninterrupted.

Natio!al (i"ru,tio! i! ,ro(uctio!5 9ational policy on employment does

not permit any employer to oust the wor/er recruited by the organisation.

Therefore* it is %ery essential to recruit the wor/ers according to the needs of

the enterprise and to de%elop a recruitment policy of the organisation to a%oid

any unnecessary hardship in the near future. 6nly manpower planning can help

the organisation in this regard.

i Natio!al ,olic' o! e,lo'e!t5 9o effecti%e employee de%elopment

programme can be wor/ed out unless it is lin/ed with the manpower

re,uirements of the organisation. While de%eloping e employee de%elopment

programmes* the talent* abilities and moti%es of he indi%iduals as well as the

organi7ational ob0ecti%es in relation to the manpower should be ta/en into

consideration. n effecti%e manpower planning can only help the organisation to

ma/e its employee de%elopment programmes effecti%e.

Effectie recruiti!g5

ssuming the company authori7es you to fill a position* the ne-t step is to de%elop an

applicant pool. The more applicants you ha%e* the more selecti%e you can be in your

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hiring. (f only two candidates apply for two openings* you may ha%e little choice but to

hire them. 5ut if 1+ or 2+ applicants appear* you can use techni,ues li/e inter%iews and

tests to screen out all but the best.

The recruiting yield pyramid:

(t is a historical arithmetic relationships between recruitment leads and in%itees* in%itees

and inter%iews* inter%iews and offers made* and offers made and offers accepted.

(t is used to calculate the number of applicants they must generate to hire the re,uired

number of new employees.


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=irms can;t always get all the employees they need from their current staff* and some

times they 0ust don;t want to. =ollowing are the sources that firms use to hire

candidates:

1. d%ertising

2.


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What should an application form contain?

Co,a!' Liite(

Breliminary application for the post of ccountant

8ate:

(. Bersonal History

a. 9ame in full

b. arital status

c. 8ate of birth

d.


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67' careful "electio! i" i,orta!t8

With a pool of applicants* the ne-t step is to select the best candidates for the 0ob.

#electing the right employee is important for three main reasons.

1 Mour own performance always depends in part on your subordinates.


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f. Ta/ing immediate disciplinary action if problems arise.

Selectio!5

#election is the process of differentiating between applicants in order to identify and hire

those with a greater li/elihood of success in a 0ob.

Recruitment refers to the process of identifying and encouraging prospecti%e candidates

to apply for 0obs whereas selection is concerned with pic/ing the right candidates from a

pool of applicants.

A. Selectio! ,roce""5

#election is a long process* commencing from preliminary inter%iew of the applicants

and ending with the contract of employment. #election process differs from organi7ation

to organi7ation and between two different 0obs within the same organi7ation. #election

procedure for senior managers will be longAdrawn and rigorous* but it is simple and

short while hiring shop floor wor/ers.

B. E!iro!e!tal factor" affecti!g "electio!5

#election is influenced by se%eral factors. ore prominent among them are supply and

demand of specific s/ills in the labour mar/et* unemployment rate* labour mar/et

conditions* legal and political considerations* company;s image* company;s policy and

cost of hiring.

C. +relii!ar' i!terie35

The purpose of this inter%iew to re0ect misfits for reasons* which did not appear in the

application forms. (t;s a good public relations e-ercise.

D. Selectio! te"t"5

3ob see/ers who pass the screening and preliminary inter%iew are called for tests.

8ifferent types of tests may be administered* depending on the 0ob of the company.

enerally* tests are used to determine the applicants a&ilit'* a,titu(e and

,er"o!alit'. bility tests assist in determining how well an indi%idual can perform tas/s

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related to the 0ob. n e-cellent illustration of this is the typing test gi%en to a

prospecti%e employee for a secretarial 0ob. n aptitude test help determine a person;s

potential to learn in a gi%en area. Bersonality tests are gi%en to measure a prospecti%e

employee;s moti%ation to function in a particular wor/ en%ironment. (nterest tests are

used to measure an indi%idual;s acti%ity preference. raphology test is designed to

analy7e the handwriting of an indi%idual. (t has been said that an indi%idual;s

handwriting can suggest the degree of energy* inhibitions and spontaneity* balance and

control. =or e-ample* big letters and emphasis on capital letters indicate the tendency

towards dominations and competiti%eness. slant to the right* moderate pressure and

good legibility show leadership potential. Bolygraph tests are designed to ensure

accuracy of the information gi%en in the applications. edical tests re%eal physical

fitness of candidate. Whate%er tests one may conduct it should be reliable and %alid.

E. E,lo'e!t i!terie35

The ne-t step in selection process is employment inter%iew. The inter%iew is conducted

at the beginning and at the end of the selection process.

(nter%iew is a formal* inAdepth con%ersation conducted to e%aluate the applicant;s

acceptability. (t is considered to be a e-cellent selection de%ice. (t can be adapted to

uns/illed* s/illed* managerial and professional employees. (t allows a twoAway e-change

of information* the inter%iewers learn about applicant* and the applicant about the

employer.

While conducting inter%iew one must be careful of bsence of reliability* lac/ of %alidity

and 5ias.

(nter%iew has at least three ob0ecti%es &i' helps obtain additional information from the

applicantI &ii' facilitates gi%ing general information to the applicant such as company

policies* 0ob* products manufactured and the li/eI &iii' help build the company;s image

among the applicants.

Do:" a!( Do!:t" 37ic7 i!terie3er" "7oul( ree&er:

8o;s:

a. Blan the inter%iew

b.


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d. $o%er the ground as planned

e. Brobe where%er necessary

f. naly7e career and interests to re%eal strengths* wea/nesses* patterns and beha%iour.

g. aintain control o%er the direction and time ta/en for the inter%iew.

8on;ts:

a. #tart the inter%iew unprepared.

b. Blunge too ,uic/ly into to demanding ,uestions.

c. s/ leading ,uestions

d. 3ump to conclusions on inade,uate e%idences.

e. Bay too much attention to isolated strengths and wea/nesses.

f. llow the candidate to gloss o%er important facts.

g. Tal/ too much.

6ther guidelines for effecti%e inter%iew are:

1. lways use the structured form.

2.

ay ( see your resume?

What can ( do for you?

Why are you interested in 0oining our company?

What do you thin/ you can do for us?

What attracts you to us?

Tell me about your e-periences.

What pay do you ha%e in mind. &Try tactfully to a%oid answering this one early in the

inter%iew'

Rea(i!g otiatio!

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(s your present employer aware of your interest in a 0ob change?

Why do you want to change your 0ob?

What caused you to enter your 0ob field?

Why do you want to change your field of wor/?

What would li/e to be doing fi%e years from now when you retire?

What is the ideal 0ob for you?

Regar(i!g e(ucatio!5

8escribe your educational ,ualifications.

Why did you chose your ma0or?

What was your class standing?

What e-traAcurricular acti%ities did you ta/e part in?

What honors did you earn?

What were your a%erage grades?

Ha%e you had any special training for this /ind of 0ob?

Regar(i!g e9,erie!ce

Why should ( hire you?

How did you fit the re,uirements of this 0ob?

Who has e-ercised greatest influence on you? How?

What are your greatest strengths and limitations for this 0ob?

Which super%isors you li/e best and why?

Why did you lea%e your pre%ious 0ob?

$ould ( see the samples of your wor/?

Regar(i!g ,a'

What do you re,uire?

What is the minimum pay will you accept?

What is your pay record for the last fi%e years?

Why do you belie%e you are ,ualified for so much more?

=. Refere!ce a!( &ac@grou!( c7ec@"

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any employers re,uests names* addresses and telephone numbers or references for

the purpose of %erifying information and perhaps* gaining additional bac/ground

information on an applicant.

These references are to be chec/ed for two important purposes. 6ne purpose is to gain

insight about the potential employee from the people who ha%e had pre%ious e-perience

with him or her. The second purpose for reference chec/s is to access the potential

success of a prospect.

G. Selectio! (eci"io!

fter obtaining information through the preceding steps* selection decision the most

critical of all steps must be made. The other stages of the selection process ha%e been

used to narrow the number of candidates. The final decision has to be made from the

pool of indi%iduals who pass the tests* inter%iews and reference chec/s. 6ther senior

managers and officers are pooled in before ma/ing decision on selection of candidate.

H. +7'"ical e9ai!atio!

fter the selection decision and before the 0ob after offer is made* the candidate is

re,uired to undergo a physical fitness test. 0ob offer* is often contingent upon the

candidate being declared fit after physical e-amination. The results of medical fitness

test are recorded in a statement and are preser%ed in the personnel records.


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employment will %ary according to the le%el of the 0ob* but the following chec/list sets

out the typical headings:

1. 3ob title

2. 8uties* including phrase such as >the employee will perform such duties and

will be responsible to such a person* as the company may from time to time

direct@.

. 8ate when continuous employment starts and the basis for calculating

ser%ice.

!. Rate of pay* allowances* o%ertime and shift rates* methods of payment.

". Hours of wor/ including lunch brea/ and o%ertime and shift arrangements.

G. Holiday arrangements:

a. Baid holidays per year.

b. $alculation of holiday pay.

c. Lualifying period.

d. ccrual of holidays and holiday pay.

e. 8etails of holiday year

f. 8ates when holidays can be ta/en.

g. a-imum holidays that can be ta/en at any one time.

h. $arryo%er of holiday entitlement.

i. Bublic holidays.

O. #ic/ness

a. Bay for the time lost.

b. 8uration of sic/ness payments.

c. 8eductions of edical insurance benefits.

d. Termination due to continual illness.

e. edical certificate.

). Cength of notice due to and from employee.

P. rie%ance procedure or reference to it.

1+. 8isciplinary procedure or reference to it.

11. Wor/ rules.

12. rrangements for terminating employment.

1. rrangement for union membership.

1!. #pecial terms relating to rights to patents and designs* confidential

information and restraints on trade after termination of employment.

1".


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The selection process does not end with e-ecuting the employment contract. There is an

another step a more sensiti%e one reassuring those candidates who ha%e not been

selected. #uch candidates must be told that they were not selected* not because of any

serious deficiencies in their personalities* but because their profiles did not match the

re,uirements of the organi7ation. They must be told that those who were selected were

done purely on relati%e merit.

Di"cu""io! ?ue"tio!"5

1. (f you were a chairman of your company* what considerations would guide your

0udgment on the following employment issues:

a.Hiring of relati%es of employees?

b.Hiring the physically handicapped?

c.Hiring #c;s* #T;s and candidates belonging to minority communities.

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Orientation and placement

Orie!tatio!5

6rientation* also called induction* is designed to pro%ide a new employee with the

information he or she needs to function comfortably and effecti%ely in the organi7ation.

good induction programme has three main elements:

i


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personnel department to answer the personnel department to answer the problems that

a new employee may ha%e on the 0ob and to respect some of information gi%en earlier.

(nduction is a followAup action of hiring and concerned with the problem of introducingor orienting a new employee to the organisation.

When a new employee reports for duty* he should be welcomed as a new members of

the organi7ation and must be helped to get ac,uainted and ad0usted with his fellow

employees and wor/Aen%ironment. The first day of employment is long remembered by

most of the people. (nitial impression counts much* later in the attitude of the employee

towards the 0ob and the company.

The new employee must be got introduced with the fellow employees and to the wor/ing

conditions* rules and regulations if he has not already been introduced at the time of

occupational test. (t is a first step in the proper communication of the personnel policy

and see/s to build a twoAway channel of information between management and

employees.

46

(rpose of Orientation(rpose of Orientation

0eel,elcome and

&t Ease

1egin the+ociali2ation

Process

/nderstandthe

Organi2ation

)no ,hat#s Expectedin ,or! and

1ehavior

Orientation HelpsNe Employees


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6rientation con%eys three types of information

&i' eneral information about the daily wor/ routineI

&ii' re%iew of the organi7ation;s history* founding fathers* ob0ecti%es* operations and

products or ser%ices* as well as employee;s 0ob contributes to the organi7ation;s

needs and

&iii' detailed presentation* perhaps in a brochure* of the organi7ations policies* wor/

rules and employee benefits

The primary reason the orientation is to ma/e new employee feel >at home@ in the new

en%ironment. This helps them to o%ercome an-ieties in the new wor/ing culture.

To,ic" t7at are coere( i! EO+

1. Orga!i>atio!al i""ue"

History of


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To super%isor

To trainers

To coAwor/ers

To employee counselor

). %o& (utie"

3ob location

3ob tas/s

3ob safety re,uirements

6%er%iew of 3ob

3ob ob0ecti%es

Relationships to other 0ob.

48

$ompanyOrgani2ation and

Operations

+afety 'easuresand Regulations

0acilities"our

EmployeeOrientation

Employee 1enefit#nformation

PersonnelPolicies

DailyRoutine


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+lacee!t5

fter an employee has been hired and oriented* he or she must be placed in hisFher

right 0ob. Blacement is understood as the allocation of people to 0obs. (t is the

assignment or reAassignment of an employee to a new or different 0ob.

few basic principles should be followed at the time of placement of a wor/er on the

0ob. These maybe enumerated below:

i an should be placed on the 0ob according to the re,uirements of the 0ob. The 0obs

should not be ad0usted according to the ,ualifications or re,uirements of the man. >3ob

first* an 9e-tQ should be the principle of placement .

ii The 0ob should be offered to the man according to his ,ualifications. 9either higher*

nor lower* e-cept in case of inter%iew placement.

iii the employee should be made con%ersant with the wor/ing conditions pre%ailing in

the industry and all things relating to the 0ob. He should also be made aware of the

penalties if he commits a wrong.

i While introducing the 0ob to the new employee* an effort should be made to

de%elop a source of loyalty and coAoperation in him so that he may reali7e his

responsibilities better towards the 0ob and the organisation.

Note"5

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After studying this chapter, you should be able to:

1. 8escribe the appraisal process.

2. 8e%elop* e%aluate* and administer at least four performance appraisal tools.

.


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Co,ari!g +erfora!ce A,,rai"al a!( +erfora!ce Ma!agee!t

+erfora!ce a,,rai"al

"ppraisal )ools

roblems in "ppraisal


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ppraisals play an integral role in the employer;s performance management

process.

ppraisals help in planning for correcting deficiencies and reinforce things done

correctly.

ppraisals* in identifying employee strengths and wea/nesses* are useful for

career planning

ppraisals affect the employer;s salary raise decisions.

Reali"tic A,,rai"al"

Motiatio!" for "oft le""t7a!ca!(i( a,,rai"al"

The fear of ha%ing to hire and train someone new

The unpleasant reaction of the appraisee

company appraisal process that;s not conduci%e to candor

Ha>ar(" of gii!g "oft a,,rai"al"

mployee loses the chance to improve before being forced to change jobs.

!a"suits arising from dismissals involving inaccurate performance appraisals.

Co!ti!uou" i,roee!t

management philosophy that re,uires employers to continuously set and

relentlessly meet e%erAhigher ,uality* cost* deli%ery* and a%ailability goals by:


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8irection sharing

Role clarification

oal alignment

8e%elopmental goal setting

6ngoing performance monitoring

6ngoing feedbac/

$oaching and support

Berformance assessment &appraisal'

Rewards* recognition* and compensation

Wor/flow and process control and return

Defi!i!g Goal" a!( 6or@ Effort"

Gui(eli!e" for effectie goal"

ssign specific goals

ssign measurable goals

ssign challenging but doable goals


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Bro%ides ad%ice and assistance regarding the appraisal tool to use.

Brepares forms and procedures and insists that all departments use them.

Responsible for training super%isors to impro%e their appraisal s/ills.

Responsible for monitoring the system to ensure that appraisal formats and

criteria comply with


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Ran/ing employees from best to worst on a particular trait* choosing highest*

then lowest* until all are ran/ed.

+aire( co,ari"o! et7o(

Ran/ing employees by ma/ing a chart of all possible pairs of the employees for

each trait and indicating which is the better employee of the pair.

Force( (i"tri&utio! et7o(

#imilar to grading on a cur%eI predetermined percentages of ratees are placed in

%arious performance categories.


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(n%ol%es setting specific measurable goals with each employee and then periodically

re%iewing the progress made.

1. #et the organi7ation;s goals.

2. #et departmental goals.

. 8iscuss departmental goals.

!. 8efine e-pected results &set indi%idual goals'.

". Berformance re%iews.

G. Bro%ide feedbac/.

Co,uteri>e( a!( 6e&Ba"e( +erfora!ce A,,rai"al

+erfora!ce a,,rai"al "oft3are ,rogra"

eep notes on subordinates during the year.


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Strict!e""Ile!ie!c'

The problem that occurs when a super%isor has a tendency to rate all

subordinates either high or low.

Bia"

The tendency to allow indi%idual differences such as age* race* and se- to affect

the appraisal ratings employees recei%e.

Ho3 to Aoi( A,,rai"al +ro&le"

Cearn and understand the potential problems* and the solutions for each.

Use the right appraisal tool.


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67o S7oul( Do t7e A,,rai"i!g8

The immediate super%isor

Beers

Rating committees

#elfAratings

#ubordinates

G+A8egree feedbac/

A(a!tage" a!( Di"a(a!tage" of A,,rai"al Tool"

T7e A,,rai"al

T',e" of a,,rai"al i!terie3"

#atisfactorySBromotable

#atisfactoryS9ot promotable

UnsatisfactoryS$orrectable

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UnsatisfactorySUncorrectable

Ho3 to co!(uct t7e a,,rai"al i!terie3

Tal/ in terms of ob0ecti%e wor/ data.

8on;t get personal.

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60

Source: Davi! "ntonion- 5Improving the erformance Management rocess #efore Discontin(ing erformance"ppraisals-6 Compensation and Benefits Review May@$(ne 1AA- p, BB- B,


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Ho3 to 7a!(le a (efe!"ie "u&or(i!ate

Recogni7e that defensi%e beha%ior is normal.

9e%er attac/ a person;s defenses.

Bostpone action.

Recogni7e your own limitations.

Ho3 to critici>e a "u&or(i!ate 8o it in a manner that lets the person maintain his or her dignity and sense of

worth.

$ritici7e in pri%ate* and do it constructi%ely.

%oid onceAaAyear >critical broadsides@ by gi%ing feedbac/ on a daily basis* so

that the formal re%iew contains no surprises.

9e%er say the person is >always@ wrong

$riticism should be ob0ecti%e and free of any personal biases on your part.

Ho3 to e!"ure t7e i!terie3 lea(" to i,roe( ,erfora!ce

8on;t ma/e the subordinate feel threatened during the inter%iew.

i%e the subordinate the opportunity to present his or her ideas and feelings and

to influence the course of the inter%iew.

Ha%e a helpful and constructi%e super%isor conduct the inter%iew.

6ffer the subordinate the necessary support for de%elopment and change.

Ho3 to 7a!(le a foral 3ritte! 3ar!i!g

+ur,o"e" of t7e 3ritte! 3ar!i!g

To sha/e your employee out of bad habits.

Help you defend your rating* both to your own boss and &if needed' to

the courts.

6ritte! 3ar!i!g" "7oul(5

(dentify standards by which employee is 0udged.

a/e clear that employee was aware of the standard.

#pecify deficiencies relati%e to the standard.

(ndicates employee;s prior opportunity for correction.

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Creati!g t7e Total +erfora!ce Ma!agee!t +roce""

>What is our strategy and what are our goals?@

>What does this mean for the goals we set for our employees* and for

how we train* appraise* promote* and reward them?@

What will be the technological support re,uirements?

The formal and systematic appraisal of employees in (ndia is a comparati%ely recent

de%elopment.

#imilarly* the systematic study of performance appraisal practices in (ndia is also limited.


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suitabilityI and &iii' for training and de%elopment purposes. 6ther ob0ecti%es of appraisal

were: informing employee where he stands* followAup inter%iews* disco%ering

super%isory personnel* little or no change in the statements o of ob0ecti%es e-cept for a

shift towards adopting a more formal statement of ob0ecti%es at the time of introduction

of forms or changing from design.

The sur%eys show that companies ha%e different criteria to e%aluate their employees.

There are basically three groups of criteria being used for appraisal purpose: &i'

e%aluation of ,ualitati%e characteristics* such as* intelligence* integrity* honesty*

leadership an attitudes* abilities* etc.* e%aluation of actual performanceA ,ualitati%ely

and ,uantitati%elyI and e%aluation of de%elopment and future potential and de%elopment

by an employee during the period under consideration. Howe%er* companies face certain

problems in de%eloping e%aluati%e criteria. #uch problems are in the area of de%eloping

uniform and generally agreedAupon norms on any o%erall company basisI de%eloping

,uantitati%e an ,ualitati%e indices of wor/ performanceI de%eloping criteria for

e%aluating employeeQs potentialI and fitting employee e%aluation with organisational

ob0ecti%es. #ome other problems are in the area of implementation of the results of

appraisal. (n many cases* where companies are using formal appraisal system*

independent decisions are ta/en by management in terms of rewards* promotion*

transfer* and de%elopment. #uch decisions 0eopardies the ob0ecti%es of formal appraisal

system.

There is a wide %ariation in periodicity of appraisal of employees. #ome companies

appraise annually* some appraise halfAyearly* and a few ,uarterlyI howe%er* annual

appraisal is most common. =urther* in terms of timing of appraisal* two situations e-istI

&i'


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sub0ecti%e approach in appraisal. #uch fact is more rele%ant in the case of those

companies which do not follow formal and systematic appraisal systems.

Note"

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67at i" Reu!eratio!8

Remuneration is the compensation which an employee recei%es in return for the

contribution to the organi7ation. (t occupies an important place in the life of an employee.

Remuneration helps one lead a standard of li%ing that is desired.

=or the employer* employee remuneration is significant because

it contributes to the cost of production. The retention of the

employee too is dependent on what the organi7ation pays its

employees.

The HR specialist has a difficult tas/ of fi-ing wages acceptable

to the employees and their leaders.

What are the components of remuneration?

65

Objective 3: /nderstandingPerformance &ppraisal 4 Performance

'anagement

"ppraisal Metho!s

"ppraisal )ools

roblems in "ppraisal


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typical remuneration of an employee comprises Wages and salary* incenti%es* fringe

benefits* per,uisites and non monetary benefits.

6age" a!( Salar'

Wages represent hourly rates of pay* and salary refers to the monthly rates of pay

irrespecti%e of the number of hours put in by an employee. These are sub0ect to annual

increments. They differ from employee to employee and depend upon the nature of 0ob*

seniority and merit.

These include such benefits as pro%ident fund* gratuity* medical care* hospitali7ation*

accident relief* health and group insurance* canteen* uniform* recreation and the li/e.

+er?ui"ite"5

These are allowed to e-ecuti%es and include company car* club membership* paid

holidays* furnished house and the li/e. (t is offered to retain competent e-ecuti%es.

No!Mo!etar' &e!efit"5

These include challenging 0ob responsibilities* recognition of merit* growth prospects*

competent super%ision* comfortable wor/ing conditions* 0ob sharing and fle-time.

Factor" i!flue!ci!g 3age a!( "alar' "tructure5

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1. The organi7ation;s ability to pay.

2. #upply and demand of labour.

. The pre%ailing mar/et rate. &Wage sur%ey is generated from time to time by

go%ernment which helps in understanding the minimum wage' =or e-ecuti%es

$ompanies ct 1P"G puts cap on salary and per,uisites of managers. #ec 1P) and

+P of the act contains pro%isions relating to the managerial remuneration.

!. The cost of li%ing.

". The li%ing wage.

G. Broducti%ity.

O. Trade union;s bargaining power.

). 3ob re,uirements.

P. anagerial attitudes.

1+. Bsychological and sociological factors.

11. Ce%els of s/ills a%ailable in the mar/et.

There is no particular formula for fi-ing the wage or salary. 6nce an indi%idual is aware

of how much the organi7ation is willing to in%est on manApower* he must study the

pre%ailing mar/et rates* wage sur%eys and also $ompanies ct;s fi-ation of salaries for

managers as a tool to come out with employees wage and salary structure.

6age a!(


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Hal"e' +reiu +la! of i!ce!tie et7o(" of 3age ,a'e!t5

Under this system* a time wage is guaranteed. The standard time re,uired in

completing the standard 0ob is determined beforeAhand on the basis of time and

motion studies and or prepast record.

(n Halsey Blan* 5onus paid to a wor/er is e,ual to "+ of time sa%ed multiplied by

rate per hour.


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$ase 1:

Time ta/en 1+ hrs


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(f the wor/er ta/e less time than the standard time his efficiency is more than 1++

and he is gi%en wages for the actual time and bonus at the rate of 2+.

The abo%e are the couple of plans that companies adopt to arri%e at the bonus for the

blue collared wor/ers.

T7e follo3i!g are "oe et7o(" u"e( to otiate e,lo'ee"5

oti%ation and morale are helped through a suggestion scheme. =or e-ample* the

suggestion scheme is described as >partnership for progress@ scheme at Telco.

ccording to the $ompany* it has helped boost employee morale. Under this scheme*

handsome cash awards are offered to employees who come up with practice ideas to

sa%e money* materials or man hours and increase producti%ity. Under this scheme* many

suggestions ha%e been recei%ed and implemented dealing with di%erse sub0ects such as

reuse of scrap* import substitution* sa%ing in operation time* impro%ements in

procedures* safety and beautifying the town. This testifies to the popularity of schemeI.

The $ompany gi%es away* on an a%erage* Rs. !+*++++ a year in #uggestions 5o- awards

which is probably the highest amount disbursed by an organisation in (ndia.

ACCgenerates a sense of >security@ and a >family atmosphere@ by gi%ing preference to

the employeesQ relati%es in certain cases. (n $$ Ctd.* weightage is gi%en to an applicant

who is related to an employee who has retired or died or is about to retire. The relati%e

must be a son* daughter* nephew or sonAinAlaw who is li/ely to help such employeeQs

family. #uch weightage preference is gi%en only once. #ome organi7ations in (ndia do

create a strong family atmosphere. =or e-ample* in $$ Ctd.* apart form this aspect

contributing to the family concept there is no formal induction of new employee in a

department. The induction automatically ta/es place in the department with all the

members of the department pitching in li/e a family to ma/e the new entrant feel a part

of the family.

t the

need of the employees by prescribing that %acancies for higher positions must be filled

up from within* where%er possible* i.e.* whene%er suitable departmental candidates

e-ist. idAle%el outAside recruitment is indulged in only when departmental candidates

do not possess the re,uisite ,ualifications* e-perience and e-pertise Bromotions are

based on both merit and seniority. They are authori7ed by a duly constituted

departmental promotion committee.

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n interesting facet of irlo"@ar Cui!"is their belief that producti%ity or industrial

efficiency programmes >can yield desired results only if there is a unity of purpose

between the wor/ers and the management.@ The wor/ers must therefore be allowed

their due share in the gains of producti%ity. any other companies do agree ostensibly

with this concept. irlo"@ar Cui!" Lt(.* on the other hand* has already gone ahead

and based its incenti%e schemes on this fundamental principle. The earnings from

incenti%es are scientifically lin/ed with the companyQs monthly operating results and

standards are fi-ed and communicated publicly.


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Trai!i!g a!( Deelo,e!t

O&;ectie5To u!(er"ta!( t7e !ee( for

Trai!i!g a!( Deelo,e!t

o Deteri!e trai!i!g !ee("

o O! t7e ;o& et7o("

o Off t7e ;o& et7o("

Mea!i!g of E9ecutie Deelo,e!t

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The e-ecuti%e de%elopment is a planned* systematic and continuous process of learning

and growth designed to induce beha%ioral change in indi%iduals by culti%ating their

mental abilities and inherent ,ualities through the ac,uisition* understanding and use of

new /nowledge* insights and s/ills as they are needed for more effecti%e performance of

the wor/ of managing.

anagers de%elop not only by participating in formal courses of instruction drawn by the

organisation but also through actual 0ob e-perience in the organisation. (t should be

recogni7ed that it is for the organist ion to establish the de%elopment opportunities for

its managers and potential managers. 5ut* an e,ual rather more important counterpart

to the efforts of organisation are those of the indi%iduals. (t should be accepted as

discipline of self education. Te indi%iduals must ha%e the moti%ation and the capacity to

learn and de%elop. s the indi%iduals differ from one another in aptitudes* attitudes*

talents* aspiration* needs and moti%ation* they should by pro%ided an effecti%e

organi7ational climate to de%elop themsel%es and change their beha%ior in managing the

people and resources.

#ince World War ((* tremendous emphasis has been laid on the de%elopment of

e-ecuti%e talent in the field of management. There was a dramatic change in the area of

management de%elopment and it has been named as >anagement re%olution.@ 9ow it

has become one of the most important and comple- tas/ of the personnel management.

(t has now been well recogni7ed that ,ualified e-ecution needed throughout the industry

and trade do not 0ust emerge from labor force without consciously planned action on the

part of the organisation. ood organi7ations select the talented employees and de%elop

them to ha%e ade,uate in%entory of management s/ill for us in the future to achie%e the

desired ob0ecti%es of the organisation.

The processes of de%elopment and training are often confused. Training means learning t

basic s/ill and /nowledge for a particular 0ob or a group of 0obs and there is no choice

with the employer whether to train or not* the only choice is tat of method to be

employed. (t occurs as a result of controlled e-ternal stimulation but de%elopment ta/es

place when the indi%idual is internally moti%ated. 8e%elopment means self de%elopment

and organi7ations only to pro%ide for the necessary condition for the de%elopment. The

initiati%e for de%elopment should be ta/en by the indi%idual himself. oreo%er* it

de%elops the o%erall personality of the indi%idual while on the other hand the training

programme see/s to de%elop the s/ill and /nowledge for a particular 0ob.

Selectio! of t7e et7o( for orga!i>i!g a trai!i!g ,rogra

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fter ha%ing decided the training needs* it is ad%isable to lay down the ob0ecti%es of

training on the basis of needs an the circumstances of the case in consultation with the

true mangers.

(t should also be decided which method it is to be adopted for the training on the basisof the needs and the ob0ecti%es of the training programme. The programme should be

chal/ed out with the aim to contribute towards the organisation ob0ecti%es.

Ste," to (eteri!e trai!i!g !ee("

(n order to assess the training needs* following steps may be ta/en.

i 3obs and the worth of the men should be analysed through 0ob analysis and

performance appraisal techni,ues and if there is an imbalance between the man an the

0ob* it should be corrected through organising training programmes.

ii Broduction problems li/e low producti%ity* poor ,uality* high cost* high rate of

absenteeism and labour turno%er indiscipline etc.* should be identified to indicate the

need for training.

iii 6pinions may be obtained from the management and the wor/ers trough inter%iews

or through ,uestionnaire regarding necessary and desirable training programme.

i Cine managers may forecast the manpower re,uirements in the future on the basis

of long term plans regarding business e-pansion* new plantsI new designs and new

de%eloped technology. Training may be gi%en to e-isting employees to enable them to

meet the future re,uirements.

training programme should be set up only after ha%ing decided the clearAcut ob0ecti%es

in mind* otherwise it will be a sheer wastage of money in organising the training

programme.

Training is usually needed where there is a special problem interfering with productionsuch as e-cessi%e turno%er among new employees* high rat of absenteeism* i rat of

accidents* spoilage of wor/ etc.* and management feels that such problems would be

sol%ed if proper training programme is organised.

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The management should* therefore e%ol%e a systematic programme of training wor/ers

which will help in turn the management a lot. The ma0or %alues of training may be

discussed below:A

1.

product of training is that spoiled wor/ and damages to machinery and e,uipments can

be /ept at minimum by the well trained employees. Trained employees will be able to

ma/e better and economical use of materials* machinery and e,uipments. Thus it helps

in deducting the cost of production.

*. Re(uce( Su,eri"io!" a!( Directio!5 well trained people of self reliant because

he /nows what to do and how to do and understands is responsibilities well.


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of learning trough trial and error. #/illed wor/Aforce can be de%eloped by the

organisation within a short span of time.

0. Better

they are being properly cared for* and that the employer is sincere to them. This will

impro%e the relations between the employees.

2. Re(uce( Acci(e!t"5 enerally* industrial accidents are caused by deficiencies in

people than by deficiencies in e,uipments and wor/ing conditions. Broper training in 0ob

s/ills and safety attitude will naturally contribute towards a reduction in the accident

rate.

14. Better Ma!agee!t5 n effecti%e training programme will assist the management

in maintaining higher standard of ,uality. 5uilding a satisfactory organisation structure*

delegating authority and stimulating employees which will* in turn* help the

management in impro%ing the planning* organising* controlling and actuali7ing.

great %ariety of management de%elopment techni,ues are used by different

organisations to de%elop their e-ecuti%e manpower

The selection of techni,ues rests on the philosophy of de%elopment. There are two

principal methods of e-ecuti%e de%elopment which are generally used by the firms. 6ne

is onAtheA0ob de%elopment and the other is offAthe 0ob de%elopment. We shall discuss

here under the %arious oneAtheA0ob and offAtheA0ob e-ecuti%e de%elopment technologic

There are %arious methods

1. O!t7e;o& Met7o(

$. OffT7e%o&Met7o("

O!t7e;o& Met7o(

(t is most popular method of de%eloping the e-ecuti%e talent. The main techni,ues are

a Coac7i!g. Under this techni,ue* the superior coaches the 0ob /nowledge and s/ill*

to his subordinates. He briefs the trainees what is e-pected of them and guides how to

get it. He also watches their performance and directs them to correct the mista/es. The

main ob0ecti%e of this training is to pro%ide them di%ersified /nowledge. $oaching is

recognised as one of t managerial responsibilities* and the manger as an obligation to

train an de%elop the subordinates wor/ing under him. He delegates his authority to the

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subordinates to prepare them to handle the comple- situations.

& U!(er"tu('. This system is ,uite different from the system discussed abo%e. Under

this system* a person is specifically designated as the their apparent who is called the

understudy. The understudyQs future depends on what happens to his superior lea%es his

post due to promotion* retirement or transfer. Te department manger pic/s up one

indi%idual from the department to become his understudy. He guides him to learn his 0ob

and tac/le the problems tat confront the manger.

c %o& Rotatio!. Under this system* an indi%idual is transferred one 0ob to another or

from open department all to another in the coordinated and planned manager with a

%iew to broaden the general bac/ground of the trainee in the business. The trainees is

rotated from one 0ob to another and thus the ac,uires a considerable degree of

speciali7ed /nowledge and s/ill but a man can ne%er ac,uire t di%ersified s/ill needed for

promotion unless is deliberately put in different types of situations.

( S,ecial +ro;ect. special assignment is a highly useful training de%ice* under

which a trainee is assigned a pro0ect that is closely related to his 0ob. He well study the

problem and submit the written recommendations upon it. (t will not only pro%ide the

trainee a %aluable e-perience in tac/ling the problem but would also ha%e the other

%alues of educating the trainees about t importance of t problem but would also ha%e

the other %alues of educating the trainees about the importance of the problem and to

understand the organi7ational relationship of the problem with different angles. Thus the

trainee ac,uires /nowledge of the assigned tas/ and learns to wor/ with other s ha%ing

different %iew points.

e Coittee A""ig!e!t"5 This system is similar to special pro0ect. Under this

system an adAhoc committee is constituted and is assigned a sub0ect related to the

business to discuss and ma/e recommendations. The committee will study the problem*

discuss it and submit to be report containing the %arious suggestions and

recommendations to the departmental manager. With a %iew to a%oid the unnecessary

hardships in studying the problem* the members of the committee should be selected

from different departments* ha%ing speciali7ed /nowledge in different fields but

connecting to the problem.

Off t7e %o& Met7o(

T7e ai! tec7!i?ue" u!(er t7i" et7o( are5

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a S,ecial Cour"e". The method of special courses re,uires the trainee to lea%e the

wor/ place and to de%ote is entire time to de%elopmental ob0ecti%es. The prime ob0ect of

such special courses is to pro%ide an opportunity to te trainee to ac,uire /nowledge with

full de%otion. 8e%elopment is primary and wor/ is secondary. These courses may be

conducted in a number of waysA=irstly* the organisation establishes such courses to be

taught to the trains by the members of the firm or by the regular instructor appointed

by the firm or by the regular instructor appointed by the firm or by the specialists

&professors and lecturers from other outside institutions. The second approach to this

techni,ue is to send the personnel to programmes established by the colleges or

uni%ersities. The organisation sponsors some of its members to the courses and bears

the e-penses. The third approach to the techni,ue is to wor/ with a college or other

institutions in establishing a course or a series of courses to be taught by faculty

members. big organisation may starts its own training school.

& Role +la'i!g. Under this method* two or more trainees are assigned different roles

to play by creating an artificial conflict situation. 9o dialogue is gi%en before hand. The

role players are pro%ided with he written or oral description of the situation and the role

to play. #ufficient time is gi%en to the role players to plan tier actions and they must act

their parts before the class. =or instance role playing situation may be a super%isor

discussing grie%ances with is subordinate.

c Ca"e Stu('. $ase study techni,ue is e-tensi%ely used in teaching law* business

management* human relation* etc.* to let the trainee understand that there mat be

different solutions to a particular problem. Under this method* the trainees are gi%en a

realistic problem to discuss* which is more or less related to the principles already

taught. This method pro%ides an opportunity to the trainee to apply his s/ill to the

solution of realistic problems. $ases may be used in either of the two ways:A &i' They

can be used after e-posing the formal theory under which the trainee applies their s/ill

to specific situation* or &ii' They may be assigned to the trainees for written analysis or

oral discussion without any prior discussion of the theory.

( Co!fere!ce. conference is a group meeting conducted according to an organised

plan is which members participate in oral discussion of a particular problem and thus

de%elop their /nowledge and understanding. (t is an effecti%e training de%ice for

conferences members and conference leaders. 5oth learns a lot from others %iew point

and compare his opinions with others. The conference leaders may also learn how to

de%elop his s/ill to moti%ate people through his direction of discussion. $onferences may

of three types:A &i' The directed or guided conference* &ii' $onsultati%e conference* and

&ii' Broblem sol%ing conference. Howe%er guided conference is generally used for

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communication. The members* under this method* sit around a table and discuss. The

trainer* usually a psychologist* neither leads the discussion nor suggests what should be

discussed but only guides the discussion. The members freely discuss and critici7e the

beha%iour of each other thereby gi%ing a feed bac/ positi%e or negati%e.

i +rograe(

than that absolutely re,uired in the performance of their 0obs. #ome organi7ations

pro%ide some time for reading which will ad%ance the general /nowledge and

bac/ground of the indi%iduals. any organisations purchase some high le%el 0ournals li/e

the $ommerce* the $apitalist* the anagement in o%t.* etc*. nd dailies li/e the


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& Co!fere!ce a!( Sei!ar5There are two types of seminars. There first is that in

which a student gi%es a lecture on some predetermined topic and is followed by

discussion and e-change of %iews under a chairman who sums u the discussion by is

fruitful ad%ice an comments. The second method is that where all students participate in

the seminar.

c Ca"eStu('5$ase study is a practical problem faced by an industrial unit which is

discussed at large in the group* possibly to find an optimum solution. The Trainee

studies the problem and finds the solution. Te super%isor re%iews the solutions an

discusses it with the trainees.

( Role +la'i!g5 Under this system* the trainees play assigned role &such as the role

of super%isor* instructor* etc.' under an instructor who prepares them and assign

different roles for the play.

e"ti&ule Trai!i!g

Under this method* the training is not gi%en on the 0ob but wor/ers are trained on

specific 0obs in a special part of the plant by models.

Training is gi%en in a class room where wor/ing conditions are created which are similar

to the actual wor/shop conditions. fter training* the wor/er is put on similar 0obs in the

wor/shop. (t should be noted that a well ,ualified and trained instructor should be the

inAcharge of the programme.

This method is e-pensi%e because there is a duplication of material* e,uipment and

conditions found in real wor/Aplace but it is a correct blending of theory an practical

wor/.

A,,re!tice"7i, Trai!i!g ,rograe"5 tend towards education than onAtheA0ob

training or %estibule schools in which /nowledge and s/ill in doing a craft or a series of

related 0obs are in%ol%ed.

Note"5

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Chapter 9

La&or La3"

O&;ectie5

To U!(er"ta!( t7e La&or La3"

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ny dearness allowance &that is to say* all cash payment by whate%er name called paid

to an employee on account of a rise in the cost of li%ing'* house rent allowance*

o%ertime allowance* bonus* commission or any other allowance payable to the employee

in respect of employment or of wor/ done in such employment.

ny present made by the employer.

Excluded Employee:

X


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ny establishment which has at the end of any financial year accumulated losses e,ual

to or e-ceeding its entire net worth and

ny establishment engaged in manufacturing of &a' 0ute &b' 5reed &d' coir and &e'

uar gum (ndustriesF =actories. The contribution under the


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attaining the age of "! years or within one year before actual retirement on

superannuation whiche%er is later. $laim application in form 1P may be submitted to the

concerned Bro%ident =und 6ffice.

%ccumulations of a deceased member:

mount of Bro%ident =und at the credit of the deceased member is payable to nomineesF

legal heirs. $laim application in form 2+ may be submitted to the concerned Bro%ident

=und 6ffice.

&ransfer of Proident !und account:

Transfer of Bro%ident =und account from one region to other* from


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What is (ratuity)

Eratuity; is a retrial benefit. This act en%isages in pro%iding a retirement benefit to the

wor/man who ha%e rendered long and unblemished ser%ice to the employer. ratuity is

a reward for long and meritorious ser%ice.

%pplicability of the %ct:

employee@ on the termination of his employment after

he has rendered continuous ser%ice for not less than fi%e years.

a. O! 7i" "u,era!!uatio!.

&. O! 7i" retiree!t or re"ig!atio!.

c. O! 7i" (eat7 or (i"a&lee!t (ue to acci(e!t or (i"ea"e.

96T


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of gratuity payable under the ct is Rs. 1++*+++ to Rs. 2*"+*+++ with effect from +2A+!A

PO.9ow at present the ma-imum limit is ." lacs.

!orfeiture of gratuity:

The gratuity of an employee whose ser%ice ha%e been terminated for any ct of willful

omission or negligence causing any damage or loss to or destruction of property

belonging to the employer* gratuity shall be forfeited to the e-tent of the damage or loss

caused. The right of forfeiture is limited to the e-tent of damage.

The gratuity payable to an employee shall be wholly forfeited:

1. (f the ser%ices of such employee ha%e been terminated for his riotous or disorderly

conduct or any other act of %iolence on his part* or

2. (f the ser%ice of such employee ha%e been terminated for any act which constitutes

an offence in%ol%ing moral turpitude* pro%ided that such offence is committed by him in

the course of his employment.

P%-ME& .! B./" +%,+/,%&$.

Recently an ordinance The Bayment of 5onus &mendment' ordinance was promulgated

by The Bresident.

ll those employees drawing 5asic V 8 up to Rs. 1+*+++FA per month are eligible to get

5onus.

=or the calculation of 5onus the ma-imum 5asic V 8 to be ta/en is Rs. "++FA per

month.

(f you calculate minimum bonus Y ). of &5asic V 8' for the complete year* it will

come out to be one monthQs &5asic V 8'.

(n short the minimum bonus to be paid for the year is one month &basic V 8' sub0ect

to ma-imum of Rs. "++FA

s for the period* it is ta/en as a =inancial year in most cases. Howe%er some companies

also ta/e the period until the month of 8iwali while calculating bonus.

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+.0E1%(E /DE1 &HE E"$ %+&2 3456

The Act was origina! a""ica#e to non$seasona %actories &sing "ower an'

e("o!ing 20 or (ore "ersons) #&t it is now a""ica#e to non$seasona "ower

&sing %actories e("o!ing 10 or (ore "ersons an' non$"ower &sing %actories

e("o!ing 20 or (ore "ersons.

*n'er +ection 1,5- o% the Act the +che(e has #een e/ten'e' to sho"s hotes

resta&rants cine(as inc&'ing "reiew theatre roa' (otor trans"ort &n'ertaings

an' news"a"er esta#ish(ent e("o!ing 20 or (ore "ersons.

The e/isting wage$i(it %or coerage &n'er the Act is s.10000$ "er (onth ,with

e%%ect %ro( 1.10.2006-.

AREAS COERED

The


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Managerial remuneration:

/-1. SCHEDULE

122).

9o person shall be eligible for appointment as a managing or wholeAtime director or a

manager &hereinafter referred to as managerial person' of a company unless he satisfies

the following conditions* namely:A

&a' he had not been sentenced to imprisonment for any period* or to a fine e-ceeding

one thousand rupees* for the con%iction of an offence under any of the following cts*

namely.A

&i' the (ndian #tamp ct* 1)PP &2 of 1)PP'*

&ii' the $entral


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&-' the $ustoms ct* 1PG2 &"2 of 1PG2'*

&-i' the onopolies and Restricti%e Trade Bractices ct* 1PGP &"! of 1PGP'* &-ii' the

=oreign


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1.


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&b' gratuity payable at a rate not e-ceeding half a monthQs salary for each completed

year of ser%ice* and

&c' encashment of lea%e at the end of the ten

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