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Personal management

Personal management can be defined as obtaining using and maintaining a atisfied workforce. It

is a significant part of management concerned with employees at work and with their

relationship within the organization.

According to flippo personal management is the planning, organizing, compensation,

integration and maintaince of people for the purpose of contributing to organizational

individual and societal goals.

According to brech, personal management is that part which is primarily concerned with human

resource of organization

Nature of Personnel Management

1. Personnel management includes the function of employment, development and compensation-These functions are performed primarily by the personnel management in consultation with other

departments.

2. Personnel management is an extension to general management. It is concerned with promotingand stimulating competent work force to make their fullest contribution to the concern.

3. Personnel management exist to advice and assist the line managers in personnel matters.

Therefore, personnel department is a staff department of an organization.4. Personnel management lays emphasize on action rather than making lengthy schedules, plans,

work methods. The problems and grievances of people at work can be solved more effectively

through rationale personnel policies.5. It is based on human orientation. It tries to help the workers to develop their potential fully to the

concern.

6. It also motivates the employees through its effective incentive plans so that the employees

provide fullest co-operation.7. Personnel management deals with human resources of a concern. In context to human resources,

it manages both individual as well as blue- collar workers.

Role of Personnel Manager

Personnel manager is the head of personnel department. He performs both managerial and operative

functions of management. His role can be summarized as :

1. Personnel managerprovides assistance to top management- The top management are the peoplewho decide and frame the primary policies of the concern. All kinds of policies related to

personnel or workforce can be framed out effectively by the personnel manager.2. He advices the line manager as a staff specialist- Personnel manager acts like a staff advisor

and assists the line managers in dealing with various personnel matters.3. As a counsellor,- As a counsellor, personnel manager attends problems and grievances of

employees and guides them. He tries to solve them in best of his capacity.

4. Personnel manager acts as a mediator- He is a linking pin between management and workers.5. He acts as a spokesman- Since he is in direct contact with the employees, he is required to act as

representative of organization in committees appointed by government. He represents company

in training programmes.

Functions of Personnel Management

Follwoing are the four functions of Personnel Management:

1. Manpower Planning2. Recruitment

3. Selection

4. Training and Development

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Manpower planning:

Manpower Planning which is also called as Human Resource Planning consists of putting right numberof 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 organization. Human Resource Planning has got an important

place in the arena of industrialization. Human Resource Planning has to be a systems approach and iscarried out in a set procedure. The procedure is as follows:

1. Analysing the current manpower inventory

2. Making future manpower forecasts

3. Developing employment programmes4. Design training programmes

Steps in Manpower Planning

1. Analysing the current manpower inventory- Before a manager makes forecast of futuremanpower, 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 unitsOnce 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:a. Expert Forecasts: This includes informal decisions, formal expert surveys and Delphi

technique.

b. Trend Analysis: Manpower needs can be projected through extrapolation (projectingpast trends), indexation (using base year as basis), and statistical analysis (central

tendency measure).

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

d. Work Force Analysis: Whenever production and time period has to be analysed, dueallowances have to be made for getting net manpower requirements.

e. Other methods: Several Mathematical models, with the aid of computers are used toforecast manpower needs, like budget and planning analysis, regression, new venture

analysis.

3. Developing employment programmes- Once the current inventory is compared with futureforecasts, the employment programmes 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, expansionplans, 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.

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Importance of Manpower Planning

1. Key to managerial functions- The four managerial functions, i.e., planning, organizing,

directing and controlling are based upon the manpower. Human resources help in the

implementation of all these managerial activities. Therefore, staffing becomes a key to allmanagerial functions.

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

industrialization world of today. Seting of large scale enterprises require management of largescale manpower. It can be effectively done through staffing function.

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

comprises of motivational programmes, i.e., incentive plans to be framed for further participationand 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 arestrong. 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 possiblemanner. higher productivity is a result of minimum wastage of time, money, efforts and energies.

This is possible through the staffing and it's related activities ( Performance appraisal, training

and development, remuneration)

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 overstaffingcan 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 ultimatelyhelps in the stability of a concern.

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Recruitment:

Types of recruitment:Recruitment is of 2 types

1. Internal Recruitment - is a recruitment which takes place within the concern or organization.

Internal sources of recruitment are readily available to an organization. Internal sources areprimarily three - Transfers, promotions and Re-employment of ex-employees. Re-employment of

ex-employees is one of the internal sources of recruitment in which employees can be invited

and appointed to fill vacancies in the concern. There are situations when ex-employees provide

unsolicited applications also.Internal recruitment may lead to increase in employees productivity as their motivation level increases.

It also saves time, money and efforts. But a drawback of internal recruitment is that it refrains the

organization from new blood. Also, not all the manpower requirements can be met through internalrecruitment. Hiring from outside has to be done.

Internal sources are primarily 3

a. Transfers

b. Promotions (through Internal Job Postings) and

c. Re-employment of ex-employees - Re-employment of ex-employees is one of the internal

sources of recruitment in which employees can be invited and appointed to fill vacancies in theconcern. There are situations when ex-employees provide unsolicited applications also.

2. External Recruitment - External sources of recruitment have to be solicited from outside the

organization. External sources are external to a concern. But it involves lot of time and money.

The external sources of recruitment include - Employment at factory gate, advertisements,employment exchanges, employment agencies, educational institutes, labour contractors,

recommendations etc.

a. Employment at Factory Level - This a source of external recruitment in which theapplications for vacancies are presented on bulletin boards outside the Factory or at the

Gate. This kind of recruitment is applicable generally where factory workers are to be

appointed. There are people who keep on soliciting jobs from one place to another. Theseapplicants are called as unsolicited applicants. These types of workers apply on their own

for their job. For this kind of recruitment workers have a tendency to shift from onefactory to another and therefore they are called as badli workers.

b. Advertisement - It is an external source which has got an important place in recruitmentprocedure. The biggest advantage of advertisement is that it covers a wide area of market

and scattered applicants can get information from advertisements. Medium used is

Newspapers and Television.c. Employment Exchanges - There are certain Employment exchanges which are run by

government. Most of the government undertakings and concerns employ people through

such exchanges. Now-a-days recruitment in government agencies has becomecompulsory through employment exchange.

d. Employment Agencies - There are certain professional organizations which look

towards recruitment and employment of people, i.e. these private agencies run by privateindividuals supply required manpower to needy concerns.

e. Educational Institutions - There are certain professional Institutions which serves as an

external source for recruiting fresh graduates from these institutes. This kind of

recruitment done through such educational institutions, is called as Campus Recruitment.They have special recruitment cells which helps in providing jobs to fresh candidates.

f. Recommendations - There are certain people who have experience in a particular area.

They enjoy goodwill and a stand in the company. There are certain vacancies which are

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filled by recommendations of such people. The biggest drawback of this source is that thecompany has to rely totally on such people which can later on prove to be inefficient.

g. Labour Contractors - These are the specialist people who supply manpower to the

Factory or Manufacturing plants. Through these contractors, workers are appointed oncontract basis, i.e. for a particular time period. Under conditions when these contractors

leave the organization, such people who are appointed have to also leave the concern.

Employee selection process:The Employee selection Process takes place in following order-

1. Preliminary Interviews- It is used to eliminate those candidates who do not meet the minimum

eligiblity criteria laid down by the organization. The skills, academic and family background,

competencies and interests of the candidate are examined during preliminary interview.Preliminary interviews are less formalized and planned than the final interviews. The candidates

are given a brief up about the company and the job profile; and it is also examined how much the

candidate knows about the company. Preliminary interviews are also called screening interviews.2. Application blanks- The candidates who clear the preliminary interview are required to fill

application blank. It contains data record of the candidates such as details about age,

qualifications, reason for leaving previous job, experience, etc.3. Written Tests- Various written tests conducted during selection procedure are aptitude test,

intelligence test, reasoning test, personality test, etc. These tests are used to objectively assess the

potential candidate. They should not be biased.4. Employment Interviews- It is a one to one interaction between the interviewer and the potential

candidate. It is used to find whether the candidate is best suited for the required job or not. But

such interviews consume time and money both. Moreover the competencies of the candidate

cannot be judged. Such interviews may be biased at times. Such interviews should be conductedproperly. No distractions should be there in room. There should be an honest communication

between candidate and interviewer.

5. Medical examination- Medical tests are conducted to ensure physical fitness of the potentialemployee. It will decrease chances of employee absenteeism.

6. Appointment Letter- A reference check is made about the candidate selected and then finally he

is appointed by giving a formal appointment letter.

Training and development:

Training of employees takes place after orientation takes place. Training is the process of enhancing the

skills, capabilities and knowledge of employees for doing a particular job. Training process moulds thethinking of employees and leads to quality performance of employees. It is continuous and never ending

in nature.

Importance of Training

Training is crucial for organizational development and success. It is fruitful to both employers and

employees of an organization. An employee will become more efficient and productive if he is trained

well.Training is given on four basic grounds:

1. New candidates who join an organization are given training. This training familiarize them with

the organizational mission, vision, rules and regulations and the working conditions.2. The existing employees are trained to refresh and enhance their knowledge.

3. If any updations and amendments take place in technology, training is given to cope up with

those changes. For instance, purchasing a new equipment, changes in technique of production,

computer implantment. The employees are trained about use of new equipments and workmethods.

4. When promotion and career growth becomes important. Training is given so that employees are

prepared to share the responsibilities of the higher level job.

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The benefits of training can be summed up as:1. Improves morale of employees- Training helps the employee to get job security and job

satisfaction. The more satisfied the employee is and the greater is his morale, the more he will

contribute to organizational success and the lesser will be employee absenteeism and turnover.2. Less supervision- A well trained employee will be well acquainted with the job and will need

less of supervision. Thus, there will be less wastage of time and efforts.

3. Fewer accidents- Errors are likely to occur if the employees lack knowledge and skills requiredfor doing a particular job. The more trained an employee is, the less are the chances of

committing accidents in job and the more proficient the employee becomes.

4. Chances of promotion- Employees acquire skills and efficiency during training. They become

more eligible for promotion. They become an asset for the organization.5. Increased productivity- Training improves efficiency and productivity of employees. Well

trained employees show both quantity and quality performance. There is less wastage of time,

money and resources if employees are properly trained.

Ways/Methods of Training

Training is generally imparted in two ways:

1. On the job training- On the job training methods are those which are given to the employeeswithin the everyday working of a concern. It is a simple and cost-effective training method. The

inproficient as well as semi- proficient employees can be well trained by using such training

method. The employees are trained in actual working scenario. The motto of such training islearning by doing. Instances of such on-job training methods are job-rotation, coaching,

temporary promotions, etc.

2. Off the job training- Off the job training methods are those in which training is provided away

from the actual working condition. It is generally used in case of new employees. Instances of offthe job training methods are workshops, seminars, conferences, etc. Such method is costly and is

effective if and only if large number of employees have to be trained within a short time period.

Off the job training is also called as vestibule training,i.e., the employees are trained in a separatearea( may be a hall, entrance, reception area,etc. known as a vestibule) where the actual working

conditions are duplicated.

Wage incentive plans

Types of Wage Incentive Plans

Wage incentive plans may be classified into two broad categories as follows:

1. Individual incentive plans, and

2. Group incentive plans.

Individual Incentive Plans

Under individual incentive plans, earnings are related directly to the performance of the individual worker. In case

of group incentive schemes, earnings of a group are related to the performance of the group as a whole.

Individual incentives may be based on time or output. Under time based plans, a standard time is determined and

bonus is given if a worker completes the job in less than standard time. Under output based plans, a standard of

output is determined and workers producing more than the standard output are given bonus. Various types of

individual incentive plans are given in following diagrams:

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1. Individual Incentives

Time Based

1. Halsey or Weir Plan

This plan was developed by F.A. Halsey and was first introduced in the Weir Engineering Works, England. Under

this plan, a standard time is fixed on the basis of past performance records. A worker who completes his job

within or more than the standard time is paid a guaranteed time wage. A bonus (usually 50 per cent) of the time

saved is paid to a worker who completes his job in less than the standard time. The bonus is calculated o the

basis of time rate.

Merits

o The plan is simple to understand. A worker can easily calculate his earnings.

o Both the employee: and the workers get equal benefit of time saved.

o A guaranteed minimum wage to every worker provides a sense of security.

o The plan encourages the workers to be efficient because bonus is based on time saved.

Demeritso Standards based on past performance may not be scientific and fair.

o Workers get only half of the benefit of their efficiency.

o If the workers rush through the job to save more time, the quality of production may suffer. Wastage and spoilage

may also increase.

o Much clerical work is involved because records of time saved and bonus earned have to be kept for each worker.

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On the whole, the Halsey plan is useful during the transitionary period when a well-conceived plan based on

scientific standards is being introduced. In some textile mills this plan is used while an employee is learning the

job.

2. Rowan Plan

This is a modified form of Halsey Plan. It was developed by James Rowan of England. Under it, a minimum time

wage4 is guaranteed to every worker. A standard time is determine in advance. The bonus is that proportion ofthe wages which the time saved bears to the standard time.

Ex: Let us use the data given under the Halsey Plan

Merits

o The guarantee of minimum wage gives a feeling of security.

o Both the employer and the workers share the benefits of time saved.

o The efficient workers get bonus at a diminishing rate if they save more than 50% of the standard time. This provides a

check against over-speeding and deterioration in quality.

Demerits

o The plan is difficult to understand for an average worker.

o Efficient workers are discouraged to save more than half of the standard time.

3. Emerson Efficiency Plan

This plan was developed by Harrington Emerson. Under this plan, standard time for the job is determined

scientifically and a minimum time wage is guaranteed to all wo4rkers. Bonus is given at an increasing percentage

beyond the prescribed level of efficiency (usually 66.67 per cent). Efficiency is measured by comparing the actual

time taken with the standard time.

Ex: Standard Time (S) = 10 hrs.

Time Taken (T) = 8 hrs.

Time Wage (R) = Rs. 20 per hr.

Bonus = 10 % upto 75% efficiency

= 20% for 75% -100%

= 30% beyond 100%

Total Wages = (T R ) + (Percentage of bonus T R)

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Merits

o Guaranteed time wage provides a sense of security to all workers.

o It encourages healthy competition among workers.

o Bonus begins at 66.67 per cent efficiency which is within the reach of many workers.

Demerits

o There is little incentive after 100 per cent efficiency level.

o Employer may fix the standard time at a low level making it impossible for most of the worker s to earn bonus.

o

The plan is not very flexible or selective.4. Bedeaux Point Plan

This plan was developed by Charles E. Bedeaux in 1911. Under it, standard time for the job is set scientifically

and it is expressed in terms of B. For instance, a standard time of 240 B means the job should be completed

within 240 minutes. In determining the Bs, the time of operation and the rest time both are taken into account,

minimum time wage is guaranteed to all workers. The workers who complete the job within or more than the

standard time are paid at the normal time rate. Those who complete the job in less than the standard time are

paid bonus for the time saved. Generally, 75% of the wages for the time saved are paid as bonus to the worker

and 25% of the foreman:

Total Wages = S R + 75% of R ( S T)

Merits

o Minimum wages are guaranteed to all workers.

o The foreman is motivated to increase productivity as one fourth of the value of time saved is paid to him.

o This plan is suitable in factories wherein a worker is expected to perform different types of jobs. All the jobs can be

reduced to standard units called Bs.

o Efficiency of different section/workers in the factory can be compared.

Demerits

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o Workers may resent sharing the bonus with foreman.

o Calculations involved are complicated and workers may not be able to understand them.

o Much clerical work is involved.

Output Based

1. Taylors Differential Piece Rate Plan

F.W. Taylor, the Father of Scientific Management devised this plan. Under this system, standard task is

established through time and motion study. Two piece rates are laid down. The lower rate for those workers who

fail to complete the standard task within the allotted time and the hither rate for those who completer the task

within or less than the allotted time. The objective is to provide sufficient incentive to workers to work hard and

achieve the standard.

Ex- Suppose the standard output is 50 units per day. The piece rates fixed are Rs. 4.00 and Rs. 3.00 per unit.

Three workers A, B and C produce 40, 50 and 60 units respectively during a day. Their total wags will be as

follows:

Worker A : 40 Rs. 3.000 = Rs. 120

Worker B : 50 Rs. 4.00 = Rs. 200

Worker C : 60 Rs. 4.00 = Rs. 240

In this way, an inefficient worker is penalized as he gets a lower rate per unit.

Merits

o it provides sufficient incentives to efficient workers to put forth their best efforts.

o Inefficient workers are penalized but encouraged to reach the standard.

o Use of time and motion study help to improve and standardize work methods.

o Workers have not to share the reward with the foreman.

Demerits

o There is no guarantee of minimum wage to workers.

o The plan is harsh to workers who are just below the standard.

o It treats the workers as machines rather than as human beings.

o The employer may fix a very high standard which workers may find difficult to achieve.

2. Merricks Multiple Piece Rate Plan

This plan was developed to overcome a drawback in Taylors plan. This drawback relates to an abrupt change I

piece rate. Under it, three graded piece rates are prescribed. Workers producing less than 83% of the standard

output are paid at a basic piece rate. Those producing from 83% to 100% of the standard output are paid 110% of

the basic piece rate. Workers producing more than the standard output are paid at 120% of the basic piece rate.

Merits

o This plan reduces the severity of the Taylors plan.o It is less harsh to beginners or learners.

o It is more flexible.

o It is useful where the performance level is to be increased to 100 per cent.

Demerits

o Minimum wage is not guaranteed to workers.

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o It is liberal for the efficient workers. But all workers producing from 1% to 82.9% of the standard output are classified

as sub-standard and are paid at the same piece rate.

3. Gantts Task and Bonus Plan

This plan was developed by Henry L. Gantt, a close associate of F.W. Taylor. Under it, standard time for every

task is fixed through time and motion study. Minimum time wage is guaranteed to all workers. A worker who fails

to complete the task within the standard time receives wage for actual time spent at the specified rate. Workers

who achieve or exceed the standard get extra bonus varying between 20% to 50% of the hourly rate for the time

allowed for the task.

Ex: Suppose the standard time fixed for the job is 8 hours and the time rate is Rs. 20 per hour and the rate of

bonus is 25 per cent. A worker, who completes the task in 10 hours, will be paid Rs. 160 (8 Rs. 20) only. On the

other hand, the worker who completes the task in 6 hours will receive Rs. 200 (Rs. 160 + 25% of Rs. 160).

Merits

o Minimum wage is assured to all workers.

o Wage increase progressively with increase in efficiency. Therefore, there is sufficient incentive for efficient workers.

o Inefficient workers are not penalized severally.

Group Incentive Plans

In all the incentive wage plans given above, incentive is linked to individual performance. But in some cases, e.g.,

assembly line industries it is not possible to determine the performance of an individual worker. This is so

because several workers are required to jointly perform a single operation. In such cases it is desirable to

introduce a group incentive scheme. Under such a scheme, the bonus is calculated for a group of workers and the

total amount is distributed among the group members in preparation to the wages earned by each.

Group incentive plans earned by each.

o Individual members of the group who occupy jobs requiring special care and attention have not to bear the whole loss

of slow speed.

o Charges of favoritism in the assignment of though and easy jobs are not likely to occur.

o The skilled and experienced workers are motivated to help and train inexperienced and new members.o All these factors create teamwork and cooperative sprit in the group.

o Need for supervision and control is reduced.

Group incentive plans, however, suffer from the following disadvantages:

o An efficient worker may be penalized for the inefficiency of some inefficient members of the group.

o The incentive for an individual worker may not be strong enough to motivate.

o Rivalry among the members of the group may defeat the very purpose of team work and cooperation.

There are three main types of group incentive plans. The first one is the Priestman Bonus Plan. Under this plan, a

committee of workers and management sets the standards of performance. A minimum wage is guaranteed to

each worker. The group gets bonus when actual output exceeds the standard. The group supervisor also gets a

share in the group bonus. The plan is easy and promotes teamspirit among employees. But it makes no

distinction between efficient and inefficient workers. Townes gain-sharing plan is another system of group

incentive. Under this plan half of the savings in labour cost as a result of output in excess of the standard is

distributed among workers and the foreman. The foreman gets a certain percentages as fixed in advance. The

bonus is paid half yearly.

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The third type of group incentive plan is known as the Scanlon Plan. It is a plant-wide scheme designed to involve

workers in making suggestions for reducing the cost of operations and improving work methods by showing the

gains of increased productivity.