Ns-01 Unit-1

Topics: Human resource management, Management, Human resources Pages: 21 (5967 words) Published: February 3, 2013


Structuring Human Resource Managemnet

After going through this unit, you should be able to:
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trace the evolution of Human Resource Management (HRM); discuss the scope and importance of HRM; describe different perspectives on HRM; and appreciate various components of HRM and their role.

3.1 Introduction 3.2 Evolution of HRM 3.3 Importance of HRM 3.4 Scope of HRM 3.5 Perspectives on HRM 3.6 Components of HRM 3.7 Summary 3.8 Self-Assessment Questions 3.9 Further Readings

For any organisation to function effectively, it must have resources of men (Human Resource), money, materials and machiner. The resources by themselves cannot fulfill the objectives of an organisation, they need to be collected, co-ordinated and utilised through human resources. And, the effective management of human resources is also vital. Hence, Human Resource Management (HRM) has emerged as a major function in organisations. In this unit, we will be discussing about the structural aspect of HRM such as evolution, approaches, components and scope.

HRM activities have 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 (Gupta, 1997). 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. The Factor of Production Concept: Employees were considered a factor of production just like land, materials, machinery. Taylor’s scientific management stressed proper selection and training of employees so as to maximise productivity. 33


Human Resource Management: Context, Concept and Doundaries


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. Employers assured a fatherly and protective attitude towards their employees. 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. Rather social and psychological satisfaction was equally important. Hawthorne Experiments of Douglas McGregor also generated considerable interest in human problems of work place. This is also known as human relations concept. The Behavioural Human Resource Concept: It aimed at analysing and understanding human behaviour in organisation. Motivation, group dynamics, organisational climate, organisational conflict etc. became popular under this concept. Employees began to be considered as valuable assets of an organisation. Efforts were made to integrate employee with the organisation so that organisational goals and employees aspirations could be achieved simultaneously. Focus shifted towards management practices like two way communication, management by objectives, role of informal groups, quality circles etc. The Emerging Concept: Now employers are considered as partners in industry. They are given share in company’s stock membership. Slowly and steadily, HRM is emerging as a discipline. Unit 1 of this block has dealt in detail the emerging scenario of HRM. Unit 2 has discussed the differences between traditional personnel management and emerging HRM.




HRM is the central sub-system of an organisation (Figure 1).

Finance Sub-system




Material Sub-system


HRM Sub-system

Technical Sub-system

Figure 1: HRM as central subsystem in an organisation Source: Gupta, 1997

As the central sub-system, HRM interacts closely and continuously with all other sub-systems of...
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