BA 924 HUMAN RESOURCE MANAGEMENT

Unit I
Evolution of Human Resource Management: Human resource
activities probably been performed since ancient times. The pioneering
work of Peter Drucker and Douglas McGregor in the 1950s laid its
formal foundation. Modern concept of HRM has developed through the
following stages
a) The commodity concept: Before industrial revolution, the guild
system was the beginning of personnel management. Guild was a
closely knit group concerned with selecting, training, rewarding
and maintaining workers. Labour began to be considered a
commodity to be bought and sold.
b) The factor of production concept: employees were considered a
factor of production just like land, material, machinery. Taylors
scientific management stressed proper selection and training of
employees so as to maximise productivity.
c) The paternalistic concept: employees organised together on the
basis of their common interest and formed trade unions to
improve. Also employers began to provide schemes to workers.
d) The Humanitarian concept: It is based on the belief that
employees had certain inalienable rights as human beings and it
is the duty of the employer to protect them.
e) The behavioural Human resource concept: it aimed at analysing
and understanding human behaviour in organisation. Motivation,
group dynamics, organisational climate, organisational conflict
etc., become popular under this concept.
f) Emerging concept: Here employees are considered as partners in
industry. They are given share in companys stock membership.
Slowly and steadily HRM is emerging as a discipline in this stage.
Definition:- Human resource management is the planning, organising,
directing and controlling of the procurement, development,
compensation, integration, maintenance and separation of human
resources to the end that individual, organisational and social
objectives are accomplished.
David A. Decenzo and Stephen P. Robbins
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The importance of human factor:- The study of human factor is to

understand human capabilities and limitations. This includes applying
this information to design equipment, work environments, procedures
and policies that are compatible with human abilities. In this way one
can design technology, environment, and organizations that will work
with people to enhance their performance. The following are the
various traits of people in an organization.
Knowledge Specific information and understanding of the
job/role or the technology one is working with, is an important
factor influencing human performance.
Skills The proficiency, facility, or dexterity that is acquired or
developed through training or experience, i.e. a talent or ability
that has been developed by putting knowledge into practice.
Abilities Abilities refer to an individuals natural or acquired
mental or physical power to accomplish the job assigned to
him/her.

Memory Memory refers to the process of reproducing or

recalling what has been learned. In context of human
performance it means an individuals ability to recall what was
learned through training or experience and apply it in ones job.
Motivation A learned behaviour occurs only if it is energized/
backed by a reason; which gives purpose and direction. Both
observation and research shows that motivated employees are
more productive.

Alertness In organisation alertness is an important

determinant of human performance. The nature of the job
requires an individual to be watchful and quick in perceiving and
responding to danger or emergency.
Objectives of human resource management:I Social Objectives:
Creation of employment opportunities
Maximising productivity
Affording maximum material and mental satisfaction to workforce
Avoidance of wastage and effort
Promotion of healthy human relations
Legal Compliance
II Personnel Objectives
Provision of adequate remuneration
Job security
Training and Development
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Opportunities of advancement
Placement
Appraisal
III Enterprise Objectives
Recruitment integration and maintenance of competent workers
Forecasting and balancing the demand and supply of personnel
Employee relations
Human resource planning
III Union Objectives
Recognition of union
Formulation of personnel policies in consultation with union
Inculcating self discipline
Nature/characteristics of Human Resource Management:1.HRM is a pervasive function. It permeates all levels of decision
making in an organisation. All sections perform human resource
management in some way. Academically, the nature of the subject is
inter-disciplinary. It draws inputs from other social sciences,
particularly, sociology, psychology, political science, anthropology,
economics, etc.
2. HRM is also a comprehensive function, in that it is concerned directly
or indirectly with every decision that in any way relates, even
collaterally to human resource management, irrespective of the section
it emanates from or the level at which it is made.
3. Cost effectiveness is a must to attract, induce and mobilise
resources for its policies, draw the attention of main line management
to its policies and proposals.
4. There is a need to spot trends and tailor personnel requirements
accordingly towards perceived direction or end, to make optimum
utilisation of available human capital.
5. Human resource management department provides for an
integrating mechanism. It attempts to build and maintain coordination
between all operative levels in an organisation. It is indispensable as a
clearing house. Its added significance is due to its being an auxiliary
service which is an indispensable maintenance activity. HR department
aids line officials perform their respective allotted tasks, with direct or
incidental bearing on human resource. Policy- making does not proceed
piecemeal and organisational functioning is imparted a coherence that
might otherwise be hard to achieve. Human resource manager is
therefore a specialist advisor and performs vital staff function.
6. HRM is an imperative function for all complex organisations where
inter section interests are inextricably linked. It is action oriented as in
it the focus is on action, rather than record keeping, written procedures
3

or rules. The problems of employees at work are solved through

rational, standard policies.
7. HRM seeks to maximise employee motivation to make them
contribute to their maximum potential. The same is done through a
systematic process of recruitment, selection, training and development
together with worker-friendly policies like fair wage, bonus and reward
system, effective grievance redressal, etc.
8. HRM is people oriented. Peoples existence is defined or perceived in
two ways, that is, as individuals working for personal satisfaction and
members of a group or collectivity, contributing towards a common
objective. Together they constitute the pillars of organisation or
organisation wide effort.
9. Tangible quantifiable benefits result to the organisation as also
externalities,
intangibles
or
unquantifiable
gains
(improved
organisational culture, management-worker relations, etc.) which
optimise organisational performance. Enhanced productivity is then
used to reward employees monetarily and motivate them further
towards better and improved performance.
10. HRM is continuous activity, consistent function and not a shortterm measure. It requires constant alertness and awareness of human
relations on the part of managers to maintain healthy organisational
climate.
11. Human resource management function is of importance to Public
as well as private organisations. Fayols advocacy of management as a
universal science endorses this idea.
12. It is based on principles: Personnel management is based on
certain well defined principles, which have evolved after a great deal of
research and experimentation.

HRM Model
The American Society for Training and Development identified the
following nine human resource areas.
i.
ii.
iii.
iv.
v.
vi.
vii.

Training and Development

Organisation and Development
Job design
Human Resource Planning
Selection and Staffing
Personnel research and information systems
Compensation/benefits
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viii.
ix.

Employee assistance
Union/labour relations

Scope of HRM

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Role of Human Resource Managers

The human resource (HR) manager position is vital to the
successful operation of a business. These managers perform such
tasks as hiring, training, and maintaining a healthy workplace
environment.
Strategic Partner: One of the most important role that HRM can play
today is that of a strategic partner. Aligning HRM strategies to business
strategies is important to help the company execute its business
strategy.
Administrative Expert: Playing the role of administrative expert
requires designing and delivering efficient and effective HRM systems,
processes and practices. These include systems for selection, training,
developing, appraising and rewarding employees.
Employee Advocate: The employee advocate role entails managing the
commitment and contributions of employees. No matter how skilled
the workers may be, if they are alienated or angry, they will not
contribute their efforts to the firms success not will they stay with the
firm for long.
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Change Agent: It requires that HRM help transform organizations to

meet the new competitive conditions. In todays fast changing
competitive world, firms need to both constantly change and develop a
capacity for change. HR managers must help identify and manage
processes for change.
Hiring: An HR manager's objective is to maintain adequate staffing
levels for a business and to fill each position with the applicant who is
most qualified to perform the job successfully. To do this, an HR
manager may post job openings, test applicants, conduct or schedule
interviews, and attend recruiting events.
Orientation/Training: Orientation entails introducing a new hire to the
company and its goals, history, policies, workers, culture, and any
other information essential to function within the company. According
to the Bureau of Labour Statistics, training may entail classroom
instruction, electronic learning, videos and other tools.
Interactions: HR managers take employee complaints, mediate
conflicts, promote communication, and in some cases, assist in
negotiating union contracts.
Employee Benefits: HR managers are also charged with providing
information about employee benefits, such as 401(k)s, health
insurance, life insurance, vacation time, transit subsidies, and stock
plans.
Performance Reviews/Discipline: In many companies, HR managers
conduct or facilitate performance reviews, which is a discussion with an
employee about how "she or he is doing relative to the standards and
expectations laid out in the job description," according to the Bureau of
Labour Statistics. This also includes providing any follow-up training or
goals. If needed, HR managers perform or assist with the discipline or
firing of employees for not following company policy. They also conduct
exit interviews.
Allocating Resources/Layoffs: HR managers may help with layoff
decisions and allocating remaining resources after layoffs. They may
be responsible for informing employees of the layoffs and providing
them with severance information.
Qualities of HR/Personnel Manager:
Fairness and firmness
Tact and resourcefulness
Sympathy and consideration
Knowledge of labour and other terms
Broad social outlook
Communication skill
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 Competence
Self confidence
Decision making skill
Selflessness
Human Resource Policies: A policy is a plan of action. It is a
statement of intention committing the management to a general
course of action. When the management drafts a policy statement to
cover some features of its personnel programmes, the statement may
often contain an expression of philosophy and principle as well.
A policy statement on the other hand is more specific and
commits the management to a definite course of action.
Why companies adopt policies?
1. The work involved in formulating personnel policies requires that
the management give deep thought to the basic needs of both
the organisation and the employees
2. Established policies ensure consistent treatment of all personnel
throughout the organisation.
3. Continuity of action is assured even though top management
personnel change.
4. Policies serve as a standard of performance
5. Sound policies help build employee motivation and loyalty.
6. Sound policies help resolve intrapersonal, interpersonal and
intergroup conflicts.
Policy Formulation:
There are five principal sources for determining the content and
meaning of policies
1. Past practice in the organisation
2. Prevailing practice in rival companies
3. Attitudes and philosophy of founders of the company and also its
directors
4. Attitudes and behaviours of the middle and lower management
5. The knowledge and experience gained from handling personnel
problems.
Human
Resource
Accounting:
The
American
Accounting
Associations Committee on HRA has defined that human resource
accounting as a process of identifying and measuring data about
human resources and communicating this data to information to
interested parties. This definition considers human resource
accounting to be an extension of basic functions of accounting namely,
7

identification, measurement and communication of data related to

human resources.
Human transformation
INPUTS
MANAGERIAL
PEOPLE
SUBSYSTEMS
(Individuals,

TRANSFORMATION PROCESS

OUTPUTS

Groups
For and
acquiring,
the Total
developing,
human organisation
allocating,
SERVICES
conserving,
Provided
utilising,
by individuals
evaluating
andand
groups
rew

Objectives of HRA:
Increased managerial
awarenessintoofvaluable
the values
human
Human transformed
human of
output
resources,
Better decisions about people, based on improved information
systems,
Greater accountability on the part of management for its human
resources,
Developing new measures of effective manpower utilization,
Enabling a longer time horizon for planning and budgeting,
Better human resource planning.
Proper management of human resources
Improvement of human resources.
Depicting the true value of the organization.
Provides quantitative information on human resources which
helps the managers and investors in making decisions.
HRA communicates the worth of human resources to the
organization and to the public.
Characteristics of Human Resource Accounting
Its a system of accounting in which identification of human
resources is made.
Investment made in human resources is recorded.
Measurement of costs and values are made.
Changes occurring in human resources over a period of time are
also recorded.

 Communicates information through financial statements to

interested parties.
HRA is a part of MIS
Joint efforts of behavioral scientists, accountants and
managements are needed for the working and development of
HRA.
Models or Methods of Human Resource Accounting
Historical Cost Method:
Actual cost incurred for recruiting, hiring, training and developing
the human resources of the organization are capitalized and amortized
over the expected useful life of the human resources.
Replacement Cost Method:
This is the measure of the cost to replace a firms existing human
resources. This method has the advantages of adjusting the human
value of price trends in the economy.
Opportunity Cost Method:
In this method, the human resource of an organization has to be
valued on the basis of the economists concept of opportunity cost
which is value of benefit foregone by putting it to present use.
Present Value Of Future Earnings Method: (Lev And Schwartz)
It recognizes an individuals expected economic value to the
enterprise during his remaining service period. An estimate about the
future earning is made, and these earnings relate to the period which
extends to the date of retirement of the employees. Such earnings are
discounted by an appropriate range to get the present value.
Benefits of HRA
HRA provides the information of total cost of human assets which
can be used for calculating the benefits for business by
comparing it with the benefits provided by employees.
It offsets uncertainty and change, as it enables the organization
to have the right person for the right job at the right time and
place.
It provides scope for advancement and development of
employees by effective training and development
It helps individual employee to aspire for promotion and better
benefits
It aims to see that the human involvement in the organization is
not wasted and brings high return to the organization.
It helps to take steps to improve employee contribution in the
form of increased productivity.
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 It can foresee the change in value, aptitude and attitude of

human resources and accordingly change the techniques of
interpersonal management.
Demerits of Human resource accounting
There is no proper clear cut and specific procedure or guidelines
for finding cost and value of human resources of an organisation
Jealousy to see the high value of other employee can decrease
the efficiency of any employee because he can think why my
price is so low and other employees price is so high.
From human resource accounting, we cannot get short period
benefits like general historical accounting system.
Indian company law 1956, Indian Income tax law 1961 and other
legal laws have no rule for showing human resource assets in the
balance sheet.
There is a constant fear of the opposition from the trade unions
that placing a value on employees.
There is no universally accepted method of human resource
valuation.
Human Resource Audit
Human Resource Audit is a systematic process, which is designed
to examine the strategies, policies, procedures, documentation,
structure, systems and practices with respect to the organizations
human resource management. It systematically and scientifically
assesses the strengths, limitations, and developmental needs of the
existing human resources from the larger point of view of enhancing
organizational performance.
The Scope of HR audit
The HR audit usually covers three parameters, namely, the HR
policies and practices, the HR professionals and the HR
department.
With respect to each of these, the Audit tries to find out:
1. The actual state
2. The congruence between the desired/professed state and the
actual state;
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3. The alignment with the overall organizational strategy and goals;

and
4. The compliance with the laws and regulations.
Auditing HR Practices
All HR departments provide several services that may be
clustered into six key domains (Ulrich and Lake, 1990), staffing,
training and development, appraisal, rewards, organization governance
and communication. For each of these six domains, Ulrich recommends
four types of assessments.
The first is an assessment of activity that not only describes the
services being provided by the HR department but also assesses the
focus of the HR strategies, the distribution of responsibility, the
resource utilization, and the competencies of the HR portfolio.
The second type of assessment is that of customer value. HR
departments may be said to be providing a range of services to
customers, who are the employees of the firm. Customer surveys are
conducted to capture the employees perceptions about the
importance and the quality of the HR services.
Auditing HR Professionals
An audit of HR professionals is essentially an assessment of the
extent to which the professionals demonstrate competence for HR
function. Such an assessment requires a 360 degree feedback, and,
usually employs the following five
steps :
Developing a Model of Competencies: Before embarking on an
assessment of competence, it is necessary to first determine the
competencies that make a successful HR professional.
Collect data using the Model: Several techniques may be employed to
collect data about the extent to which an HR professional exhibits the
modeled competencies. These include interviews, questionnaires and
focused groups.
Summarise data and give feedback to the HR professionals: The
quantitative and qualitative data that is collected in the above
mentioned ways needs to be synthesized and codified so that specific
themes emerge.
Create action plans: The HR audit goes beyond defining the
competencies and inadequacies of the HR function. It also identifies
the measures to develop the competencies at both, the individual and
the departmental level.
Continuous Improvement: Auditing of HR professionals is not a
onetime audit activity but an ongoing continuous process through
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which HR professionals are able to constantly build on their HR

competencies and strengthen the HR functions in the organization.
Auditing HR Function or Department
Auditing HR function and the HR department may be an
integration of individual HR competencies. However, at the same time,
there are additional overall indicators of HR functions, such as ratio of
total employees to HR professionals, the performance of the
department against the plan, the ratio of expenditure on HR to total
sales, general costs and other such measures
The Auditing Process:. is a function of the objectives and the scope
of the Audit, the nature of the organisation and the level of
involvement of the top management. Though this process may vary
from organisation to organisation, it essentially follows the stages
described below.
1.Briefing and orientation: This is a preparatory meeting of key
staff members to:
discuss particular issues considered to be significant
chart out audit procedures, and
develop plans and programme of audit
II.Scanning material information: This involves scrutiny of all
available records and documents pertaining to the personnel as well as
personnel handbooks and manuals, guides, appraisal forms, material
on recruitment, computer capabilities, and all such other information
considered relevant.
III.Surveying employees: Surveying employees involves interview
with key managers, functional executives, top functionaries in the
organizations, and even employees representatives, if necessary. The
purpose is to identify and enumerate issues of concern, present
strengths, anticipated needs and managerial philosophies on human
resources.
IV.Conducting interviews: The key issue here is to list the pertinent
and probing questions. The decision on these questions depends on
the scope and purpose of the Audit as well as on the culture of the
organization. The skill of the interviewer lies in getting relevant and
correct information without threatening the interviewees.
V.Synthesizing: The data thus gathered is synthesized to present the:

Current situation

Priorities

Staff pattern, and

Issues identified.

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Similarly, future needs are identified and appropriate criteria

developed for

spotlighting the human resource priorities and specific

recommendations made.
VI.Reporting: Like planning meetings for briefing and orientation, the
results of the audit are discussed within several rounds with the
managers and staff specialists. In the process, the issues get further
crystallized. Based on the findings and the discussion during the
meetings, then a final report is prepared and presented formally to the
Management.
A Human Resource Management System (HRMS) or Human
Resource Information System (HRIS), refers to the systems and
processes at the intersection between human resource management
(HRM) and information technology. It merges HRM as a discipline and
in particular its basic HR activities and processes with the information
technology field.
Currently Human Resource Management Systems encompass:
The payroll module automates the pay process by gathering data on
employee time and attendance, calculating various deductions and
taxes, and generating periodic pay cheques and employee tax reports.
Data is generally fed from the human resources and time keeping
modules to calculate automatic deposit and manual cheque writing
capabilities.
The work time module gathers standardized time and work related
efforts. The most advanced modules provide broad flexibility in data
collection methods, labor distribution capabilities and data analysis
features. Cost analysis and efficiency metrics are the primary
functions.
The benefits administration module provides a system for
organizations to administer and track employee participation in
benefits
programs.
These
typically
encompass
insurance,
compensation, profit sharing and retirement.
The HR management module is a component covering many other
HR aspects from application to retirement. The system records basic
demographic and address data, selection, training and development,
capabilities and skills management, compensation planning records
and other related activities. Leading edge systems provide the ability
to "read" applications and enter relevant data to applicable database
fields, notify employers and provide position management and position
control.

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Online recruiting has become one of the primary methods employed

by HR departments to garner potential candidates for available
positions within an organization.
The training module provides a system for organizations to
administer and track employee training and development efforts. The
system, normally called a Learning Management System if a stand
alone product, allows HR to track education, qualifications and skills of
the employees, as well as outlining what training courses, books, CDs,
web based learning or materials are available to develop which skills.
Courses can then be offered in date specific sessions, with delegates
and training resources being mapped and managed within the same
system. Sophisticated LMS allow managers to approve training,
budgets and calendars alongside performance management and
appraisal metrics.
The Employee Self-Service module allows employees to query HR
related data and perform some HR transactions over the system.
Employees may query their attendance record from the system without
asking the information from HR personnel.
An Applicant Tracking System (ATS) is a software application that
enables the electronic handling of recruitment needs. An ATS can be
implemented on an Enterprise or small business level, depending on
the needs of the company. ATS systems are very similar to Customer
Relationship Management Systems, but are designed for recruitment
tracking purposes.
Learning management system A learning management system
(commonly abbreviated as LMS) is a software application for the
administration, documentation, tracking, and reporting of training
programs, classroom and online events, e-learning programs, and
training content.
E-learning comprises all forms of electronically supported learning
and teaching. The information and communication systems, whether
networked or not, serve as specific media to implement the learning
process. E-learning is essentially the computer and network-enabled
transfer of skills and knowledge. E-learning applications and processes
include Web-based learning, computer-based learning, virtual
classroom opportunities and digital collaboration. Content is delivered
via the Internet, intranet/extranet, audio or video tape, satellite TV,
and CD-ROM. It can be self-paced or instructor-led and includes media
in the form of text, image, animation, streaming video and audio.
Computer-Based Trainings (CBTs) are self-paced learning activities
accessible via a computer or handheld device. CBTs typically present
content in a linear fashion, much like reading an online book or
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manual. For this reason they are often used to teach static processes,
such as using software or completing mathematical equations. The
term Computer-Based Training is often used interchangeably with Webbased training (WBT) with the primary difference being the delivery
method. Where CBTs are typically delivered via CD-ROM, WBTs are
delivered via the Internet using a web browser.
Computer-supported collaborative learning (CSCL) is one of the
most promising innovations to improve teaching and learning with the
help of modern information and communication technology. Most
recent developments in CSCL have been called E-Learning 2.0, but the
concept of collaborative or group learning whereby instructional
methods are designed to encourage or require students to work
together on learning tasks has existed much longer.
Technology enhanced learning (TEL) has the goal to provide sociotechnical innovations (also improving efficiency and cost effectiveness)
for e-learning practices, regarding individuals and organizations,
independent of time, place and pace. The field of TEL therefore applies
to the support of any learning activity through technology.
Electronic Performance Support Systems, EPSS, can help an
organization to reduce the cost of training staff while increasing
productivity and performance. It can empower employees to perform
tasks with a minimum amount of external intervention or training. By
using this type of system an employee, especially a new employee, will
not only be able to complete his or her work more quickly and
accurately, but as a secondary benefit the employee will also learn
more about the job and the employer's business.
Advantages
Reducing the complexity or number of steps required to
perform a task
Providing the performance information an employee needs
to perform a task
Providing a decision support system that enables an
employee to identify the action that is appropriate for a
particular set of conditions

Unit II
Human Resource Planning:
Definition: it is the process by which an organisation ensures that it
has the right number and kinds of people, at the right places, at the
right time, capable of effectively and efficiently completing those tasks
that will help the organisation achieve its overall objectives. Human
15

resource planning, then, translates the organisations objectives and

plans into the number of workers needed to meet those objectives.
Decenzo
The objectives of HRP are mainly to:
a) Ensure optimum utilization of human resources currently employed;
b) Assess or forecast future requirements;
c) Cope up with the changing scenario;
d) Attaching with business plans of organization;
e) Anticipate redundancies;
f) Provide basis for human resource development (HRD); and
g) Assist in productivity bargaining.
Benefits of HRP
Proper HRP results into a number of benefits. Some of them are:
a) Create reservoir of talent.
b) Preparation for future HR needs.
c) Promote employees in a systematic manner.
d) Provide basis for HRD.
e) Help in career and succession planning.
HR Planning Process

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Forecasting Human Resource Requirements

Forecasting is the attempt to determine the supply of and
demand for various types of human resources to predict areas within
the organisation where there will be future labour shortages or
surpluses.
Forecasting techniques
a)Managerial Judgment: In this, experienced managers estimate the
human resource requirements or their respective departments on the
basis of their knowledge of expected future work load and employee
efficiency.
b) Work-study Method: In this method time and motion study are
used to analyze and measure the work being done.
c) Ratio-Trend Analysis: Under this method ratios (e.g. total
output/no. of workers, direct workers/indirect workers) are calculated
on the basis of past data. Future ratios are basing on the past trend.
d)Delphi Technique: Named after the ancient Greek oracle at the city
of Delphi, the Delphi technique is a method of forecasting personnel
needs. It solicits estimates of personnel needs from a group of experts,
usually managers.
e) Mathematical Models: It expresses the relationship between
independent variable (e.g. investment, production, sales, etc.) and
dependent variables (e.g. no. of employees required).
Job Analysis: a job analysis is a systematic exploration of the
activities within a job. It is a basic technical procedure, one that is used
to define the duties, responsibilities and accountabilities of a job. This
analysis involves compiling a detailed description of tasks, determining
the relationship of the job to technology and to other tasks and
examining the knowledge, qualifications or employment standards
accountabilities and other incumbent requirement.
A job element is the smallest unit into which work can be
divided. Putting the tomato on a hamburger is an example of an
element in the job
A task is a distinct work activity carried out for a distinct purpose.
Example typing a letter, preparing a lecture etc.
A duty is a number of tasks. Example a general accounting clerks
duties might include preparing the monthly income statement
and distributing the weekly payroll checks.
A position refers to one or more duties performed by one person
in an organisation. Example Assistant professor, Clerk

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 A job is a type of position within an organisation. If a large

insurance company employs sixty life insurance actuaries, then
there are sixty positions but just one insurance actuary job.
An occupation is a group of similar jobs found across
organisations. Eg. Electrician, accountant etc.
A career represents a sequence of positions, jobs, or occupations
that a person has over his or her working life.
Purposes of job analysis
A job analysis is the conceptual, analytical process or
action from which we develop our tangible outcomes; job
descriptions, job specifications, and job evaluations.
Job Description
A job description is a written statement of what the
jobholder does, how it is done, and why it is done. It should
accurately portray job content, environment, and conditions of
employment. A common format for a job description includes
the job title, the duties to be performed, the distinguishing
characteristics
of
the
job,
and
the
authority
and
responsibilities of the job holder.
Job Specifications
The job specification states that the minimum acceptable
qualifications that the incumbent must possess to perform the
job successfully. Based on the information acquired through
job analysis, the job specification identifies the knowledge,
skills and abilities needed to do the job effectively.

Job description
A statement containing items
Such as
Job title
Location
Job summary
Duties
Machines, tools and
equipments
Materials and forms used
Supervision given
Working conditions
Hazards

Job specification
A
statement
of
human
qualifications necessary to do
the job. Usually contains such
items as
Education
Experience
Training
Judgement
Initiative
Physical effort
Responsibilities
Communication skills
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 Emotional characteristics
Unusual demands such as
sight, smell, hearing
Recruiting:- Recruiting is the discovering of potential candidates for
actual or anticipated organisational vacancies. Or, from another
perspective, it is a linking activity bringing together those with jobs to
and those seeking jobs.
Purpose and importance of recruitment:
Determine the present and future requirements of the
organisation in conjunction with its personnel planning and job
analysis activities.
Increase the pool of job candidates at minimum cost.
Help increase the success rate of the selection process by
reducing the number of visibly, underqualified or overqualifed job
applicants.
Help reduce the probability of applicants once recruited and
selected will leave the organisation only after a short period of
time.
Increase organisational and individual effectiveness in the short
term and long term.
Evaluate the effectiveness of various recruiting techniques and
sources for all types of job applicants.
Recruiting sources:I Internal Recruitment
1. Internal Search/Present employees: Most large organisational will
attempt to develop their own employees for positions beyond the
lowest level. Its advantages are it builds morale, it encourages
good individuals who are ambitious it improves probability of a
good selection, it is less costly, they already know the
organisation etc.
2. Employee referrals: Employees can develop good prospects for
their families and friends by acquainting them with advantages of
a job with the company, furnishing cards of introduction, and
even encouraging them to apply.
3. Former Employees: Former employees are also a source of
applicants. Some retired employees may be willing to come back
to work on a part time basis or may recommend someone who
would be interested in working for the company.

19

4. Previous Applicants: Although not truly an internal source, those

who have previously applied for jobs can be contacted by mail, a
quick and inexpensive way to fill an unexpected opening.
II External Recruitment
1. Advertisements: When an organisation desires to communicate to
the public that it has a vacancy advertisements are one of the
most popular methods used. However where the advertisement is
placed is often determined by the type of job.
2. Employment Agency: There are three types of agencies, public,
state agencies, private employment agencies and management
consulting firms
a. Public Agencies: It is designed both to help job seekers find
suitable employment especially government jobs and to
help employers find suitable workers.
b. Private Employment agencies: It is similar to a government
agency but charge fee for its services. Private agencies are
believed to offer positions and applicants of a higher
caliber. It also provide a more complete line of services.
c. Management consultants/ Head hunters: It consists of the
management consulting, executive search, or headhunting
firms. Agencies of this type are actually specialised private
employment agencies. They specialise in middle and top
level executive placements.
3. Temporary help services: temporary services can be a source of
employees when individuals are needed on a temporary basis.
Temporary employees are particularly valuable in meeting short
term fluctuations in personnel needs.
4. Schools, colleges and Universities: Educational institutions offer
opportunities for recruiting recent graduates. Most educational
institutions operate placement services where prospective
employers can review credentials and interview candidates.
5. Professional Organisations; Professional organisations including
labour unions, operate placement services for the benefit of their
members.
6. Casual Unsolicited Applications/Walk ins: Walk ins whether they
reach the employer by letter, telephone or in person can be a
source of prospective applicants. Although the qualifications of
unsolicited applicants will depend on economic conditions, the
organisations image, and the job seekers perception of the types
of job that might available, this source does provide an excellent
supply of stockpiled applicants.

20

7. Contractors: Contractors are used to recruit casual workers. The

names of the workers are not entered in the company workers
and to this extent, difficulties experienced in maintaining
permanent workers are avoided.
8. Competitors: Rival firms can be a source of recruitment. Popularly
called poaching or raiding this method involves identifying the
right people in rival companies offering them better terms and
luring them away.
9. International recruiting: Recruitment in foreign countries presents
unique challenges to recruiters. In advanced nations more or less
similar channels of recruitment are available for recruiters. In less
developed countries the picture is different. Beyond employee
referrals and embassy assistance, recruitees may find that they
have to develop their own network of contacts, ranging from
newspaper reporters to government officials in the host country.
Selection: Selection is the process of differentiating between
applicants in order to identify those with a greater likelihood of
success in a job.
In other words it is the process of picking individuals with
requisite qualifications and competence to fill jobs in the
organisation.
Selection Process:
I Preliminary Interview: It is also called as initial screening. In the
overall process of selection, screening comes after the
recruitment is complete. Screening is a process of reducing the
number of applicants to a few who have better chances of
selection than those screened out. Screening is generally done on
two counts eligibility and suitability.
II Application Blank:
Once the initial screening has been
completed, applicants are asked to complete the organisations
application form. The amount of information required may be
applicants name, address, phone no, etc. Some organisations on
the other hand may request the completion of six to ten page
comprehensive personal history profile.
III Employment Tests: Job seekers who pass the screening and
the preliminary interview are called for tests. Different types of
tests may be administered, depending on the job and the
company. Tests are used to determine the applicants ability,
aptitude and personality.
Type of tests:

21

i.

ii.

iii.

iv.

v.

vi.

Cognitive ability tests: cognitive ability has many

different facets, although one focus on three dominant
ones. Verbal comprehension refers to a persons
capacity to understand and use written and spoken
language. Quantitative ability concerns the speed and
accuracy with which one can solve arithmetic problems
of all kinds. Reasoning ability a broader concept refers
to a persons capacity to invent solutions to many
diverse problems.
Performance test or achievement test: this test measures
the level of knowledge and skills which a candidate has
acquired for a particular job. For example candidates for
the post of typist may be asked to type some material in
order to judge their speed and accuracy.
Intelligence test: such a test seeks to measure the
mental capacity of an individual in terms of memory,
vocabulary, perception, reasoning etc. It also judges the
ability to deal with abstract symbols, words, ideas,
numbers etc.
Aptitude test: an aptitude test is used to measure
applicants capacity and potential for learning the skills
required for a particular job. It is helpful in predicting a
candidates success on a particular job.
Interest test: these tests are designed to find out the
interest of an applicant in the job he has applied for, two
of the most widely used tests are strong vocational
interest blank and Kuder preference record.
Personality test: Personality tests are given to measure a
prospective employees motivation to function in a
particular working environment. There are various tests
designed to assess individuals personality.
a. Thematic Appreciation Test: in this popular test the
candidate is shown a series a pictures, one at a
time and asked to write a story for each picture, for
example, in one scene there is a boy lying on the
floor next to a couch with a revolver by his side,
another picture shows a person with liquor bottle in
his hand, quarrelling with his wife. The candidate is
supposed to expand the story thus what has led up
to the current scene, what is happening at the
moment, what are the characters feeling etc. The

22

psychologist analyse the story in terms of factors as

length, vocabulary, ideas, plot, mood etc.
b. Ink Blot Test: in this test the candidate is asked to
organise unstructured ink blots into a meaningful
concepts. The resulting projections are analysed in
terms of use of colour and shades, use of part or
whole of a blot, definiteness of forms seen, etc. An
integrated picture of the candidates personality is
then formulated.
vii. Graphology test: it is designed to analyse the
handwriting of an individual. It has been said that an
individuals handwriting can suggest the degree of
energy, inhibitions and spontaneity as well as disclose
the idiosyncrasies, and elements of balance of control.
viii. Dexterity test: these tests are used to measure the
capacity of the applicant to use his fingers and hands in
the industrial work. In many companies interview is the
only tool used in selecting new employees. This is a
particularly useful in case of skilled and technical jobs.
IV Interview: The interview is designed to probe into areas that
cannot be addressed by the application form or tests. These
areas usually consist of assessing ones motivation, ability to
work under pressure, and ability to fit in with the organisation.
The interview may be conducted by personnel department
interviewers, executives within the organisation, a potential
supervisor, potential colleagues or some combination of these.
Types of Interview:
i. Individual or one to one interview: it is one of the most
common selection method. They offer the advantages of
direct face to face communication, and opportunity to
establish rapport between the candidate and interviewer.
ii. Board/Panel Interview: A panel may consist of two or more
people who together interview a single candidate: most
commonly an HR specialist and other experts.
iii. Situational interview: an interview procedure where
applicants are confronted with specific issues, questions, or
problems, that are likely to arise on the job.
iv. Structured interview or Patterned interview: under this
method a number of standard questions to be put to a
candidate are framed in advance. Ideal answers to these
questions are also determined beforehand. Then the

23

answers given by the candidate are checked with the ideal

answers to assess his suitability for the job in question.
v. Unstructured Interview: Under this type a blend of
structured and unstructured questions are used by the
interviewer while interviewing job seekers.
vi. Stress interview: in such an interview the interview
deliberately creates a situation that subjects the candidate
to considerable stress and strain. The purpose is to know
how the candidate reacts to such a situation.
vii. Depth interview: the purpose of depth interview is to get
total information of an applicant. The objective is to
develop a comprehensive profile based on in-depth
understanding of the frozen aspects of his personality and
flexible aspects of his personality. This kind of interview is
usually very time consuming because a lot of time is spent
with the applicant to get detailed information on various
aspects of his life.
viii. Group interview: under this method a number of candidates
are interviewed simultaneously. A question or problem
situation is posed before them and each candidate is asked
to participate in the discussion. It is helpful to evaluate a
candidates performance in a group.
V Background Investigation:
the next step in the selection
process is to undertake an investigation of those applicants who
appear to offer potential as employees. This may
include
contacting former employers to confirm the candidates work record
and to obtain
their appraisal of his or her performance, contacting
other job related and personal references,
and
verifying
the
educational accomplishments shown on the application.
VI Selection Decision: those individuals who perform successfully
on the employment tests and the comprehensive interview, and are
not eliminated by the development of negative information on either
the background investigation are considered to be eligible to receive
an offer of employment.
VII Physical Examination: After the selection and before the job
offer is made the
candidate is required to undergo a physical
fitness test. A job offer is often contingent upon the candidate being
declared fit after the physical examination.
VIII Job Offer: A job offer is made to those applicants who have
passed the previous hurdles. Such a letter generally contains a date
by which the appointee must report to the duty. The appointee must

24

be given reasonable time for reporting. This is necessary when he

or she is already in employment.
IX Contract of employment: After the job offer has been made
and the candidates accept the offer, certain documents need to be
executed by the employer and the candidate. One
such document
is the contract of employment. Such contracts seek to restrain job
hoppers to protect knowledge and information that might be vital to
a companys healthy bottom
line and to prevent competitors from
poaching highly valued employees.

Selection Method Standards

Personnel selection is the process by which companies decide
who will or who will not be allowed into organisations. Several
standards should be met in any of the selection process. We focus on
five (1) Reliability (2) validity (3) Generalizability (4) Utility and (5)
Legality.
Reliability: The consistency of a performance measure; the degree to
which a performance measure is free from random error. For example if
you were to have your height measured everyday with a wooden
yardstick, you would get highly reliable results. On the other hand, if
you were measured each day by an elastic tape measure, there would
probably be considerable disparity between your height measurements
from one to the next. Your height of course, does not change from day
to day. The variability is due to the unreliability of the measuring
device.
Validity: It is the extent to which performance on the measure is
related to performance on the job. A measure must be reliable if it is to
have any validity. On the other hand we can reliably measure many
characteristics that may have no relationship to whether some can
25

perform a job. For this reason. Reliability is a necessary but insufficient

condition for validity. For example just because a test score is
consistent is no indication that it is measuring important
characteristics related to job behaviour. It must also differentiate
between satisfactory and unsatisfactory performances of the job.
There are three types of validity: Content, Construct and Criterion
related.
Content Validity: A test validation strategy performed by demonstrating
that the items, questions, or problems posed by a test are a
representative sample of the kinds of situations or problems that occur
on the job.
Construct validity: It is the degree to which a particular trait is related
to successful performance on the job. These trait are usually abstract
in nature, such as measure of intelligence. This type of validity is
usually conducted by observing various behaviours of applicant and
measuring how these behaviours or traits relate to the job.
Criterion related validity: It is the degree to which a particular selection
device accurately predicts the important elements of work behaviour.
The measures reveal the relationship between test score and job
performance. To establish criterion related validity, one of the two
measures can be used: predictive validity and concurrent validity.
Predictive Validation: A criterion related validity study that seeks to
establish an empirical relationship between applicants test scores and
their eventual performance on the job.
Concurrent Validation: A criterion related validity study in which a test
score is administered to all the people currently in their job and the
incumbents scores are correlated with existing measures of job
performance.
Generalizability: The degree to which the validity of a selection method
established in one context extend to other context
Utility: The degree to which the information provided by selection
methods enhances the effectiveness of selecting personnel in real
organisations.
Legality: The final Standard that any selection methods adhere to is
legality. All selection methods should conform to existing laws and
existing legal precedents.

Socialisation: It is the process by which new employees are

transformed into effective members of the company. Effective

26

socialisation involves being prepared to perform the job effectively,

learning about organisation, and establishing work relationships.
Socialisation involves three stages
T
E
M
P
C
n
e
r
o
u
e
c
t
o
m
r
o
a
d
m
n
r
m
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i
o
r
n
o
c
t
v
i
r
t
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e
v
p
i
e
r
a
r
h
v
n
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s

Prearrival Stage: It recognizes that each individual arrives with a set of

organisational values, attitudes and expectations. Individuals also
develop expectations about the company, job, working conditions and
interpersonal relationships.
Encounter Stage: Upon entry into the organisation the new members
enter the encounter stage. Here individuals confront the possible
dichotomy between their expectations- about their job, their coworkers, their boss, and the organisation in general and reality.
Metamorphosis Stage In this stage the new members have become
comfortable with the organisation and their job. They have internalised
the norms of the organisation and their work groups; they understand
and accept these norms. The new members feel accepted by their
peers as trusted and valued individuals. They are self confident that
they have the competence to complete their job successfully. They
understand their tasks, the rules, procedures and informally accepted
practices as well.
Orientation: Orientation is only a small part of the overall socialisation
of new organisational member. It covers the activities involved in
introducing a new employee to the organisation and to his or her work
unit. Orientation involves familiarising new employees with company
rules, policies, and procedures. Typically a program includes
information about the company, department in which the employees
will be working and the community they will live in.
Benefits of Orientation
Improves employee retention rate
Communicates to employees what is expected
Helps satisfy employees need to know about where he/she works
Increases employee commitment by introducing them to the
companys mission and philosophy
Shows how individual jobs fit into overall company mission

27

Unit III
Training: Training is a learning experience in that it seeks a relatively
permanent change in an individual that will improve his or her ability to
perform on the job. Typically say training can involve the changing of
skills, knowledge, attitudes, and work behaviour. It may mean
changing what employees know, how they work, their attitudes toward
their work, or their interactions with their co workers or their
supervisors.
Need for Training:
Employment of inexperienced and new labour requires detailed
instructions for effective performance on the job
People have not to work, but work effectively with the minimum
of supervision, minimum of cost, waste and spoilage and to
produce quality goods and services.
Increasing use of fast changing techniques in production and
other operations requires training into newer methods for the
operatives.
Training is necessary when a person has to move from one job to
another because of transfer, promotion or demotion.
Old employees need refresher training to enable them to keep
abreast of changing techniques and use of sophisticated tool and
equipment.
To prevent the obsolescence of the employees by updating their
skill and knowledge.
To prepare for future assignments
To develop employee competencies
Identifying Training Needs
1.Organisational Analysis: It involves a comprehensive analysis of
organisational structure, objectives, culture, processes of decision
making, future objectives and so on.
i. Support of managers
ii. Company strategy
28

iii. Training resources

2.Task Analysis: Task involves a detailed analysis of various
components of jobs, and how they are preformed
3.Man/Person Analysis: This focus on individual, his skills, abilities,
knowledge and attitude.
i. Input instructions that tell what how and when to
perform
ii. Output- a jobs performance standards
iii. Consequences the incentives that employees receive
iv. Feedback information that employees receive
4.Analysis of equipment: Change in equipment or modification of
existing machines and equipment calls for new skills and abilities.
Inputs in Training
Skills
Knowledge
Education
Development
Ethics
Training Process
Organisational objectives and strategies

Assessment of Training Needs

Establishment of training goals

Devising training programme

Implementation of training programme

Evaluation of results

29

Methods of Training
The most popular training methods used by organisations can be
broadly classified into two types.
i. On the job training
ii. Off the job training
On the Job Training (OJT)
The most widely used methods of training take place on the job.
On-the-job training places the employees in an actual work situation
and makes them appear to be immediate productive. It is learning by
doing. For jobs that are difficult to simulate or can be learned quickly
by watching and doing, on-the-job training makes sense.
The following are the various On-the-job training methods
Apprenticeship programs: People seeking to enter skilled trades to
become, for example, plumbers, electricians or iron workers are often
required to undergo apprenticeship training before they are accepted
to journeyman status. During the apprenticeship period the trainee is
paid less than a fully qualified worker.
Job Instruction Training It is a step by step relatively simple technique
used to train employees on the job. It is especially suitable for teaching
manual skills or procedures; the trainer is usually an employees
supervisor but can be a co-worker.JIT consists of four basic steps that a
supervisor or other instructor follows when teaching an employee to do
something: 1. Preparing the trainees by telling them about the job and
overcoming their uncertainties; 2. Presenting the instruction, giving
essential information in a clear manner; 3. Having the trainees try out
30

the job to demonstrate their understanding; and 4. Placing the workers

into the job on their own with a designated resource person to call
upon should they need assistance.
Coaching: The trainee is placed under particular supervisor who
function as a coach in training the individual. The supervisor provides
feedback to the trainee on his performance and offers suggestions to
him for his development.
Job rotation: It involves the movement of a trainee from one job to
other jobs. It increases the flexibility of a system by introducing an
element of multiskilling. The key is to make use of rotation with a
minimum of disruption and learning curve effects, and to retain the
element of freshness.
Action learning: is an educational process whereby the participant
studies their own actions and experience in order to improve
performance. Learning acquires knowledge through actual actions and
repetitions, rather than through traditional instruction.
Off the Job Training
Off the job training involves taking training away from their place
of work. This is often also referred to as formal training. Off the job
training courses might be run by the business training department or
by external providers.
The following are the various types of off the job training programmes
Lectures/Conferences: The lecture or conference approach is well
adapted to conveying specific information rules, procedures or
methods. The use of audio visual or demonstrations can often make a
formal classroom presentation more interesting while increasing
retention and offering a vehicle for clarifying a more difficult point.
Audio Visuals/Films: Motion pictures can be useful training technique.
Whether purchased from standard film distributors or produced
internally by the organisation, they can provide information and
explicitly demonstrate skills that are not easily presented by other
techniques.
Simulation Exercises: Any training activity that explicitly places a
trainee in the artificial environment that closely mirrors actual working
conditions can be considered a simulation. Simulation activities include
case studies, experiential exercises, complex computer modelling and
vestibule training.
Case Study: it is a written description of an actual situation in
business which provokes in the reader; the need to decide what is
going on, what the situation really is or what the problems are, and
what can be done. Taken from the actual experiences of
organisations, these cases attempt to describe as accurately as
31

possible, real problems that managers have faced. Trainees study

the cases to determine problems, analyse causes, develop
alternative solutions, select the best one, and implement it. Case
studies can provide stimulating discussions among participants as
well as excellent opportunities for individuals to defend their
analytical and judgement abilities.
Experiential exercise: Experiential exercise is usually short,
structured learning experiences where individuals learn by doing.
For instance rather than talk about interpersonal conflicts and how
to deal with them, an experiential exercise could be used to create a
conflict situation where employees have to experience a conflict
personally and workout its resolution. After completing the exercise
the trainer discusses what happened and introduces theoretical
concepts to help explain the members behaviour during the
exercise.
Role playing: One of the most effective training methods is role
playing. Not just for sales or customer service training, this
technique is an excellent way to achieve a number of benefits for
employees, management and support people. Role playing allows a
group of employees to act out work scenarios. It opens
communications; it also gives a great deal of confidence and
develops friendship among those participating in the role play
situations.
Vestibule Training: In vestibule training, employees learn their jobs
on the equipment they will be using, but the training is conducted
away from the actual work floor. Under this method training is given
in a specially created vestibule labs that simulated the actual
environment. While expensive, vestibule training allows employees
to get a full feel for doing tasks without real world pressures.
Additionally it minimises the problem of transferring learning to the
job, since vestibule training uses the same equipment that trainee
will use on the job.
Computer Based Training
Computer assisted instruction: CAI is an improved system when
compared to other methods. First CAI provides for accountability as
tests are taken on the computer so that the management can
monitor each trainees progress and needs. Second a CAI training
programme can also be modified easily to reflect technological
innovations in the equipment for which the employee is being
trained. Third this training also tends to be more flexible in that
trainees can usually use the computer almost any time they want,
and thus get training when they prefer
32

Computer Modelling: Complex computer modelling simulates the

work environment by programming a computer to imitate some of
the realities of the job. Computer modelling is widely used by
airlines in the training of pilots.
Virtual Reality: Computer based technology that provides trainees
with a three dimensional learning experience. Trainees operate in a
simulated environment that responds to their behaviours and
reactions.
E Learning: Electronic Learning or E-Learning has been around for
last ten years. From initial strategy of a radical idea it is now
regarded as the mainstream learning technology. E- Learning is a
general term which refers to computer enhanced learning and is the
result of sophisticated computer technology. Basically, it involves
posting lessons on computer, which can be downloaded by the
users. Online training is given by the instructor to the trainee. The
most common technologies involved in E learning are E-mail, virtual
class room, E conferencing, telephone and PDAs etc.
Programmed Instruction: The programmed instruction can be in the
form of programmed texts or manuals, while in some organisations
teaching machines are utilized. All programmed instruction approaches
have a common characteristic: they condense the material to be
learned into highly organised, logical sequences, which require the
trainee to respond. The ideal format provides for nearly instantaneous
feedback that informs the trainee if his or her response is correct.
Sensitivity training: also known as T Group Training is a type of
program designed to help facilitate respect between groups that
include people with different genders, religions, ages and races. The
exact procedures can vary depending on the leader of the training, but
typically involve lectures, discussions, and exercises to help
participants understand and respect one another. The training can be
implemented anywhere, but tends to be most common in workplaces
and educational environments.
Executive Development; Executive development is a systematic
process of training and growth by which individuals gain and apply
knowledge, skills, insights and attitudes to manage work organisations
effectively
Methods of Development
The development of a managers abilities can take place on the
job. The following are the various on-the-job techniques.
Coaching: When a manager takes an active role in guiding other
manager we refer to this activity as coaching. Just as track coaches
33

observe, analyze and attempt to improve the performance of their

athletes, coaches on the job can do the same. The effective coach,
whether on the track or in the corporate hierarchy, gives guidance
through direction, advice, criticism and suggestions in an attempt to
aid the growth of the employee.
Understudy Assignment: By understudy assignment potential
managers are given the opportunity to relieve an experienced
manager of his or her job and act as his or her substitute during the
period. This label also describes permanent, assistant to position as
well as temporary opportunities to assist managers in completing their
jobs. As staff assistant to a manager, the understudy gets the
opportunity to learn the managers job.
Job rotation: Job rotation can be either horizontal or vertical. Vertical
rotation is nothing more than promoting a worker into a new position.
Horizontal transfer can be understood as lateral transfer. Job rotation
represents an excellent method for broadening the manager or
potential manager, and for turning specialists into generalists. In
addition to increasing the managers experience and allowing the
manager to absorb new information, it can reduce boredom and
stimulate the development of new ideas.
Committee Assignment: Assignment to a committee can provide an
opportunity for the employee to share in managerial decision making,
to learn by watching others, and to investigate specific organisational
problems. When committees are of an ad hoc or temporary nature,
they often take on task force activities designed to delve into a
particular problem, ascertain alternative solutions, and make a
recommendation for implementing a solution. These temporary
assignments can be both interesting and rewarding to employees
growth.
Off-the-job development: There is a wealth of management
development techniques that personnel can partake of the job. The
following are the various off-the-job development methods.
Sensitivity training: Sensitivity training in encounter groups became
popular during 1950s as a method of changing behaviour through
group processes. Often referred to as laboratory training, it influences
the participants through unstructured group interaction. Members are
brought together in a free and open environment in which participants
discuss themselves and their interactive process, loosely facilitated by
a professional behavioural scientist. This profession then creates the
opportunity for the participants to express their ideas, beliefs and
attitudes. The objective of sensitivity training is to provide managers
34

with increased awareness of their own behaviour and of how others

perceive them, greater sensitivity to the behaviours of others and
increased understanding of group processes.
Lecturers: lectures offer an opportunity for managers or potential
managers to acquire knowledge and develop their conceptual and
analytical abilities. In large organisations these lectures may be offered
in-house by the organisation itself and supported by outside college
course work.
Simulation exercises: simulations were introduced as a training
technique. They are probably even more popular for management
development. The following are the various simulation exercises used
in the organisations.
Case study: case study approach to management was popularized
at the Harvard Graduate School of Business. Taken from the actual
experiences of organisations, these cases represent attempts to
describe, as accurately as possible, real problems that managers
have faced. Trainees study the cases to determine problems,
analyze causes, develop alternative solutions, select what they
believe to be the best solution and implement it.
Simulated decision games and role playing exercises: these
exercises put individuals in the role of acting out managerial
problems. Business games, which are frequently played on an
electronic computer that has been programmed for the particular
purpose, provide opportunities for individuals to make decisions and
to consider the implications of a decision on other segments of the
organisation, with no adverse effect though the decision be a poor
one.
Role playing: Role playing allows the participants to act out
problems and to deal with real people. Participants are assigned
roles and are asked to react to one another as they would have to
do in their managerial jobs. Role playing, when combined with
modelling as presented in social learning, theory has become
increasingly popular as a development technique.
Incident Method: It deals with incidents prepared on the basis of
actual situations which happened in different organisations. Each
trainee in the training group is asked to study the incident and to
make short term decisions.
In-basket Training In basket training is a training method to acquaint
employees about their job where a number of problems are kept in
the "in basket (usually kept on the desk of the employee). The
worker has to look at the problems which could also be complaints
from different employees and simultaneously deal with those
35

problems. The problems that the employee solves, he keeps

transferring it to the "out-basket".
Knowledge Management: Knowledge management is defined as the
systematic process of finding, selecting, organising, distilling, and
presenting information in a way that improves employees
comprehension in a specific area of interest.
Process of Knowledge Management:
Identification: In this process, the knowledge that exists in various
forms in, for instance, file, computers, conversations, minds of people,
etc. is located.
Elicitation: The next step is to retrieve the knowledge that is identified.
Since knowledge can be elicited directly and indirectly from available
sources, the elicitation methods also vary. Appropriate systems need to
be created to gather information. Some of these systems are interview,
case study, protocols, simulation, prototyping, observation and
document analysis.
Classification: The third step is to classify the knowledge. The aim of
the process is put organisational knowledge into a form that makes it
accessible to those who need it. Knowledge managers can categorize
knowledge, describe it, map it, simulate it and embed it in rules. Each
of these has its own value and can be applied singly or in combination.
Storing: The gathered knowledge has to be stored in such a way that it
is readily and easily accessible. Building a robust infrastructure will
allow knowledge to be leveraged through systems and technology
platforms. It includes common communication, infrastructure, easy
accessibility to knowledge sources and having a common
organisational vocabulary.
Knowledge Worker: Knowledge workers basically use their intellect to
transform ideas, products, services and processes. Their main value to
an organisation is their ability to gather and analyse information and
make decisions to benefit the company. Knowledge workers are also
called as gold-collar workers, who are sometimes known by their
professional speciality, for example lawyer, doctor, programmer,
information system designer, librarian, teacher and scientist.
Modes of Knowledge Conversion:
Socialization: Tacit knowledge to conversion takes place when tacit
knowledge within one individual is shared by another through training.
Combination: Explicit knowledge to explicit knowledge conversion
takes place when an individual combines discrete pieces of explicit
knowledge into a whole new concept.

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Externalization: Tacit knowledge to explicit knowledge conversion can

be said to take place when an individual is able to articulate the
foundations of his or her tacit knowledge.
Internalization: Explicit knowledge to tacit knowledge conversion takes
place when new explicit knowledge is shared throughout the firm and
other members begin to use it to broaden, extend and reframe their
own tacit knowledge.
Types of Knowledge
There are two kinds of knowledge- explicit knowledge and tacit
knowledge.
Explicit knowledge can be expressed in words and numbers and shared
in the form of data, scientific formulae, specifications, manuals and the
like. This kind of knowledge can be readily transmitted across
individuals formally and systematically. Tacit knowledge, or the other
hand, is highly personal and hard to formalize, making it difficult to
communicate or share with others. Subjective insights, intuitions, and
hunches fall into this category of knowledge. Difficult to verbalize, such
tacit knowledge is deeply rooted in an individuals actions and
experience, as well as in the ideals, values, or emotions he or she
embraces.
Socialization: From Tacit to Tacit
Tacit knowledge
Managers gather information from sales and production sites, share
accumulation
experiences with suppliers and customers and engage in dialogue with
competitors.
Extra-firm social
Managers engage in bodily experience through management by
information collection
wandering about and get ideas for corporate strategy from daily social
(wandering outside)
life, interaction with external experts, and informal meetings with
competitors.
Intra-firm social
Managers find new strategies and market opportunities by wandering
information collection
inside the firm.
(wandering inside)
Transfer of tacit
Managers create a work environment that allows peers to understand
knowledge.
craftsmanship and expertise through practice and demonstrations by the
master.
Externalization: From Tacit to Explicit (Creating Concepts)
Managers perform facilitation of creative and essential dialogue, the use of adductive thinking, the
use of metaphors in dialogue for concept creation.
Combination: From Explicit to Explicit
Acquisition and
integration
Synthesis and
processing

Managers engage in planning strategies and operations, assembling internal and

external existing data by using published literature, computer simulation and
forecasting.
Managers build and create manuals, documents, and databases on products and
services and build up material by gathering management figures and /or
technical information from all over the company.

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Dissemination

Managers engage in planning and in implementation of presentations to transmit

newly created concepts.

Internalization: From Explicit to Tacit

Personal experience:
Managers engage in enactive liaisoning activities with functional dept.
real-world knowledge
by using cross functional development teams. Search and share new
acquisition
values and thoughts: share and try to understand management visions
and values through communications with fellow members in the
organization.
Stimulation and
Managers engage in facilitating prototyping and benchmarking and
experimentation; virtual- facilitate the challenging spirit within the organization; managers form
world knowledge
teams as a model and conduct experiments and share results with the
acquisition
entire dept.

Sources of Knowledge
The two sources of Knowledge are:
Internal sources emerging from the operations of the organizationinternal sources include the organizational operations such as design,
development, engineering, sales, marketing, manufacturing, customer
contact, etc. This is the basic source of organizational information,
which is controllable and can be easily canalized to KR. In the absence
of any formal mechanism, this knowledge remains in the minds of
organization members and usually, disappears with them.
External
sources
such
as
Industry/Professional
Associations,
Commercial web sites etc.- there are many professional bodies such as
IEEE, academic bodies such as universities, research institutions,
industry associations such as NEMA, and commercial organizations.
These sources usually make the knowledge available through web sites
and sometimes through publications. Some of them could be free
services and some could be for a fee. A well-designed KM should be
able to take advantage of both the sources to create
Knowledge Management Framework
Level 5
Corporate and Individual
Performance
Level 4
Delivery of Knowledge
Level 3
Grouping of Knowledge
Level 2
Technical Infrastructure and Knowledge
Resources
Level 1

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Creation of Strategy for KMS

Knowledge Management Programme

A broad KM programme in an organization requires defining a
clear strategy based on the business needs of the organization;
keeping the central KM unit small, which oversees overall
implementation; making available a budget to allow communities to
function; supporting the development of communities; keeping IT user
friendly and responsive to its users needs; introducing new incentives
to accelerate the shift towards a knowledge culture; and developing a
set of metrics to measure progress.
Steps in Knowledge Management Programme
1. Specifying the goals of the knowledge
2. Identifying the knowledge being sought
3. Collecting the required knowledge along with the sources
4. Processing and developing the acquired knowledge for
presentation purposes
5. Transferring the knowledge across individuals and groups within
the organization
6. Applying the knowledge for value addition
7. Storing the knowledge for timely availability
8. Assessing the transferred and disseminated knowledge with the
help of feedback, for modifications and changes.
Benefits of Knowledge Management
Fostering innovation by encouraging free flow of ideas
Improving customer service by streamlining response time
Boosting revenues by getting products and services to market faster
Enhancing employee retention rates by recognizing the value of
employees knowledge and rewarding them for it.
Streamlining operations and reducing costs by eliminating
redundant or unnecessary processes.
A creative approach to KM can result in improved efficiency, higher
productivity and increased revenues in practically any business
function.
Self-Development
Self-Development is taking personal responsibility for one's own
learning and development through a process of assessment, reflection,
and taking action.
How to develop self
Assess your current skills and interest through paper-andpencil career tests or through computer programs that
analyze skills and interests.
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 Maintain a learning log or diary to help you analyze what

you are learning from work experiences.
Write a personal vision and mission statement.
Develop a personal development plan that identifies your
learning needs and goals.
Find a mentor who can provide you with support, advice,
and assistance in your career direction.
Become involved in professional organizations.
Read professional journals and trade magazines to keep
current on the latest developments in your field.
Personal Competencies
I Self Awareness: It is the yardstick used to measure whether what we
are doing or planning to do is worthwhile and our feelings are the
measurement. It involves knowing ones internal state, preferences,
resources and intuitions. It involves how aware you are of our feelings,
how you view yourself and what you are doing in life. The skills needed
for this are
1.Emotional awareness is the ability to
Recognize your feelings
Differentiate between them
Identify what emotion you are feeling and why
Know what caused the feelings
Use the value to guide decision making
2. Self Assessment: this involves knowing your inner resources,
abilities and limitations. Here you aim to achieve the following
Be aware of your strengths and weaknesses
Be reflective of things you do or happen to you
Learn from your experience
Be able to show a sense of humor and perspective about
yourself
3. Self Confidence: It is very important for you to be self
confident i.e trusting or believing in your abilities, qualities and
judgment. It is very essential for superior performance
II Self Regulation: this involves managing your internal
states/emotions, impulses and resources. Therefore it is both trying not
to be distressed, or stiffing an impulse and at times intentionally
eliciting an emotion. Self regulation includes:
i. Self control
ii. Trustworthiness
iii. Conscientiousness
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iv. Attitude
v. Innovation
III Motivation
Individual Learning Strategies:
Job Rotations
Special Assignments
Coaching
Mentoring
Individual Development Plan
Manager as Teacher
Learning Groups (Teams)

Unit IV
Compensation/Pay: compensation is what employees receive in
exchange for the services rendered in an organization. In other words it
refers to all forms of financial returns and tangible benefits that
employees receive as a part of the employment relationship. It plays a
key role in recruitment, job performance and job satisfaction.
Objectives of compensation planning:
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 It ensures more difficult jobs are paid more

It ensures that jobs are fairly compensated in comparison to similar
jobs in the labour market.
It ensures equal pay for equal work, which is each individuals pay is
fair in comparison to that of another person doing the same or a
similar job.
It enables an organization to attract and retain qualified, competent
individuals.
It motivates employee performance, fosters a feeling of equity, and
provides direction to their efforts
It supports, communicates and reinforces an organisations culture,
values and competitive strategy.
Its cost structure reflects the organisations ability to pay.
Factors affecting Pay Levels:

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