Q1) Define HRM. Explain the functions performed by the HRM.  2+10

A1) Human Resource Management (HRM) is the term used to describe formal structures devised for the management of people inside an organization. The responsibilities of a human resource manager fall into three primary areas: staffing, employee compensation and benefits, and defining/designing work. According to Flippo “Personnel management, or say, human resource management is the planning, organising, directing and controlling of the procurement development compensation integration, intenance, and separation of human sources to the end that individual, organisational and social objectives are accomplished”.

The core functions of HRM are discussed below:

Figure: Functions of HRM

a)     Staffing

This includes the activities of hiring new full-time or part-time employees, hiring contractors, and terminating employee contracts. Staffing activities include:

b)    Development

On-boarding new employees and providing resources for continued development is a key investment for organizations, and HR is charged with maintaining a developmental approach to existing human resources. Development activities include:

c)     Compensation

Salary and benefits are also within the scope of human resource management. This includes identifying appropriate compensation based on role, performance, and legal requirements. Compensation activities include:

d)    Safety and Health

Achieving best practices in various industries include careful considering of safety and health concerns for employees. Safety and health activities include:

e)     Employee and Labor Relations

Defending employee rights, coordinating with unions, and mediating disagreements between the organization and its human resources is also a core HR function. Employee and labor relations activities include:

Q2) Discuss the role of HR manger in an organisation.      12

A2) The role of HR manger in smooth functioning of an organisation are discussed below-

Figure: Role of HR manager

1. Human Resource Planning

HR managers are responsible for planning and achieving organizational objectives. They usually engage in identifying, preparing, and executing business goals with top-level executives. This proactive participation in planning enables HR managers to gain a thorough understanding of the activities required to support the sustainable growth of the company. This, in turn, empowers HRs to assign the right resources to the right project and ensures timely delivery. The roles of HR managers include analysing and acknowledging team leaders (TL) about their expected vs. Actual results. They also help TLs better understand their target and create strategies to achieve them. 

2. Job Analysis and Design

As mentioned above, human resource planning requires assigning the right resources to the right project. And if the right person is not in the organization, HR managers are responsible for designing the job analysis to hire them.

A job analysis includes:

In addition to this, the responsibilities of the HR manager include:

3.Hiring Candidates

Finding and hiring the right talent is a very complex process. Modern HR managers do more than just posting job requirements in portals to fill open positions. They develop strategic solutions to attract the right candidates to fulfill the demands of the business.  From screening potential candidates on job portals and social platforms like LinkedIn to interviewing them, HR managers have to follow an organized approach for hiring the best suitable employee for the organization. Once an applicant is selected, HR managers design offer letters and onboarding procedures. In case, a candidate backs out at the last moment, HR managers are bound to convince them to join the organization. If they still insist not to, HR managers need to repeat the hiring process to fill open positions.

4. Training and Development

Hiring the best candidates is just half the job. HR managers need to train and upskill them to maximize their return on investment. The types of training and development new employees require depends on their experience. For example, if they are freshers, managers might need to arrange for skill-development training programs to ensure their work meets the industry standards. However, if the recruits already have a few years of experience, managers might only need to train them about company policies. HR managers are also answerable for the quality of training. If most of the recruits are unable to pass the assessments, it indicates that either the trainer or the training program is not compliant with the industry standard, for which the HR manager will be held accountable.

5. Design Workplace Policies

It is essential for HR managers to design workplace policies to reduce conflicts, legal issues, and improve employee productivity. These policies are designed in a way that protects the interests of both the employees and employers alike. 

Though workplace policies differ from organization to organization, the things it includes remain the same in every company, such as:  

HR managers also need to comply with federal, state, and local laws while designing workplace policies. Some laws require managers to communicate the workplace policies in writing. If you are an HR manager (or aspiring to be), make sure to stay on top of the local laws to avoid issues later.

6. Monitor Performance

Closely related to training, HR roles and responsibilities include examining employee performance records to identify the scopes of improvement and arranging training workshops to upskill them. By providing employees with a chance to learn something new and grow professionally, you can create a positive environment and boost employee loyalty. Besides, improving your employees’ skills brings additional benefits to the organization. 

The way you help employees improve their performance depends on the available resources. For instance, if you have a high budget, you can arrange trainers to personally analyse and train them to achieve better results. If not, you can enroll them to attend conferences, webinars, online courses, etc.

7. Maintaining Work Culture

As an HR manager, it is your responsibility to shape and maintain organizational culture. It is essential to create a positive impression of the company from day one, so the new employees know what to expect.  Besides, a person’s performance depends largely on the environment he is working in. Therefore, you need to install a certain level of comfort to eliminate any stressful atmosphere that might affect employees’ performance. It is also vital to have an open-door policy so that employees can communicate their problems freely. This helps improve employee job satisfaction and retain talent.  Additionally, consider planning company events where employees can showcase their non-work-related talents like singing, dancing, mimicry, etc. It enhances the overall brand image and spreads positivity throughout the organization.

8. Resolve Conflict

In every organization, employees come from diverse backgrounds. And when people with opposite opinions meet, the chances of having a conflict rise significantly. Whether the issue is between two employees or an employee and the management, it’s the HR manager who has to intervene and resolve it. Besides, the HR manager must listen to both parties without being biased or judgemental. They also need to go to the root of the matter, which includes questioning other employees.  Depending on the type of conflict, HR managers also hold the right to fire an employee. However, this situation usually arises in cases of harassment in the office.

9. Ensure Health and Safety of Employee

Employees are the asset of the organization. Unless they are safe and healthy, they won’t be able to give their best to the company. Thus, HR managers need to ensure the health and safety of employees. The way you plan for your employees’ health, and safety varies from company to company. For instance, for organizations that provide cab services to their staff, HR managers need to make sure that they are coming/reaching safely. It usually requires them to track the GPS of company cabs, call the employee/driver, keep a tab on the expected vs. Actual arrival time. 

Other roles of HR managers, in terms of health and safety of employees, include:

10. Rewards and Incentives

Lastly, HR managers need to reward employees based on their performance and other factors like punctuality. The biggest benefit of rewarding workers is that it creates a desire for other employees to excel at their job in the hope of getting incentives. The type of rewards and incentives could be anything, such as holiday packages, a word of appreciation and recognition, promotions, or bonuses. 

Q3) Explain about the qualities/competencies possessed by an HR manager.     8

A3) Human resource manager must possess the following competencies to manage the human resources of an organisation effectively and efficiently-

Figure: Competencies of HR manager

1. Effective Communication

HR professionals must have impeccable communication skills. When the job is to deal with people, it becomes paramount for any HR professional to have strong communication skills. They constantly deal with people over the phone or email, draft company policies, and conduct interviews. Therefore any HR professional must have excellent writing skills to avoid any miscommunication. They must actively listen to understand others’ perspectives and bring a more honest discussion between them and the managers. Effective communication helps HR managers to handle employee grievances empathically and also manage any internal conflicts effectively.

2. Relationship-building

Building relationships between the HR group and other departments is one of the critical components to bring business together. This helps in maximizing the potential of the organization and its success. Relationships in the workplace often need a great deal of care and communication. There are also some casual relationships (think of vendors and dealers who deliver goods to your workplace) that need your attention. Therefore, HR professionals must emphasize building relationships among every department so that they can thrive together. HR professionals must listen and respond to the concerns of the other departments and act as a glue to keep them stick together. Since a workplace has diverse individuals, HR professionals must introduce inclusive policies, and everyone feels welcomed in the workplace.

3. Adaptability Skills

The world of business is changing every day. And you cannot get too comfortable but adapt yourself to the changing times. These will allow HR managers to rethink their current company policies and curate new ones that are more relevant and effective. Since HR managers actively participate in decision-making and business strategies, they need to forecast the need for changes. For fostering a healthy work environment, HR Professionals must develop new tactics to keep the employees engaged and actively invest themselves in finding ways to retain them.

4. Technological Skills

With the whole world going increasingly digital, HR managers need the ability to adapt to new technology. HR managers are expected to handle a variety of duties that includes-

Technological skills give HR professionals an edge while managing the above duties and more. For example, social media tools help them posting job openings online and reach out to more potential candidates. And at the same, Talent Acquisition Software (ATS) makes their jobs incredibly easier while recruiting and hiring. Therefore, it is very critical for HR professionals to have good digital skills.

5. Keep Learning

As they say, learning is a never-ending process. The same holds for any HR professionals. The work culture of today’s organizations demands better management, support, growth, and development. Deepening your knowledge in the Human Resource Management field and applying new HR trends will always help you become the front runner. Therefore, prosperous HR managers look to develop and understand the benefits of new HR research outcomes and connect them to the current trends in the HR field.

6. Critical Thinking

Linder Elder, a prominent scholar, describes Critical thinking as “Self-guided, self-disciplined, thinking which attempts to reason at the highest level of quality in a fair-minded way. Critical thinking is one of the most essential attributes for anyone in HR. Whether you are hiring a new candidate, negotiating pay rises, or deciding how to deal with employee grievances, it is imperative to critically analyse the situation and make decisions. Critical thinking helps bring a rational perspective and help HR professionals to deal with a difficult situation with ease. Either it is conflict resolution or addressing an issue with the employees, and critical thinking helps reconstruct or put forward views and ideas that work best for the work environment.

7. Interpersonal skills

Interpersonal skills are the soft skills that hold great value to HR professionals. These skills include active listening, verbal and non-verbal communication, social awareness, self-management, accountability, and so on. People with high interpersonal skills are intuitively good communicators and efficient managers. They show the right attitude and aptitude while communicating. Interpersonal skills allow one to communicate successfully with others at work and in the broader community. Some people are born with this kind of ability, but they can all be enhanced with practice. Expressing respect, settling conflicts, and hearing well are all interpersonal skills worth learning for any HR professional.

8. Quick Decisions

He should display the ability to make quick decisions. Let’s assume that there is a conflict between a superior and an employee in the organization. When the HR manager tries to mediate and put an end to the conflict, he might have to make some quick decisions. He should be mentally alert and therefore not get caught unawares.

9. Patience

He should be extremely patient and not someone who loses his temper easily. While dealing with employees, it is important to be a good listener, especially when an employee is voicing his concerns. And good listening skills require a lot of patience. Further, since employees tend to talk to the HR manager about their problems, they can get agitated and verbally abusive. In such situations, it is imperative that the HR manager keeps his cool and controls the situation.

10. Leadership

Good leadership skills are essential to guide the employees towards achieving the organization’s objectives. He should also keep people motivated and encourage them to use their skills for the overall good of the enterprise.

Q4) Write a brief note on HR policy.      5

A4) Human resource policies are the formal rules and guidelines that businesses put in place to hire, train, assess, and reward the members of their workforce. These policies, when organized and disseminated in an easily used form, can serve to preempt many misunderstandings between employees and employers about their rights and obligations in the business place. It is tempting, as a new small business owner, to focus on the concerns of the business at hand, and put off the task of writing up a human resource policy. All business analysts and employment lawyers will advise a new business owner to get a policy down on paper, even if it is a simple one drafted from a boilerplate model. Having policies written is important so that it is clear to all what the policies are and that they are applied consistently and fairly across the organization. Moreover, when issues concerning employee rights and company policies come before federal and state courts, it is standard practice to assume that the company's human resource policies, whether written or verbal, are a part of an employment contract between the employee and the company. Without clearly written policies, the company is at a disadvantage. Small businesses--and especially business startups--cannot afford to fritter away valuable time and resources on drawn-out policy disputes or potentially expensive lawsuits. Having a human resource policy in place from the start can help to avoid this situation. The business owner who takes the time to establish sound, comprehensive human resource policies will be far better equipped to succeed over the long run than the business owner who deals with each policy decision as it erupts. The latter ad hoc style is much more likely to produce inconsistent, uninformed, and legally questionable decisions that may cripple an otherwise prosperous business. For as many small business consultants state, human resource policies that are inconsistently applied or based on faulty or incomplete data will almost inevitably result in declines in worker morale, deterioration in employee loyalty, and increased vulnerability to legal penalties. To help ensure that personnel management policies are applied fairly, business owners and consultants alike recommend that small business enterprises produce and maintain a written record of its HR policies and of instances in which those policies came into play.

The major outlines of the HR policy of a medium-sized organisation may be as follows:

i. Recruitment and selection policy – To procure suitably educated and efficient personnel by offering those tempting wages, good working conditions, safety and security, and better future prospects.

Ii. Training and development policy – To make available all possible facilities for the training and development of employees to enable them to do their job efficiently and to prepare them­selves for future promotions; to take effective steps including training and development pro­grammes to equip the employees in the latest techniques of production, management and so on; to get the performance appraisal done; and to provide adequate opportunities and facilities for the development of employees.

Iii. Job evaluation, wage and incentive policies – To determine reasonably good wage rates and dearness allowance, and to work out incentive plans for workers after undertaking job evalu­ation and other necessary steps and also keeping in view the prevalent wage rates for similar jobs in other industries.

Iv. Labour welfare policy – To improve industrial relations by evolving a suitable machinery for the settlement of disputes; to encourage mutual negotiations; to prepare and execute labour welfare programmes; and to arrange all possible facilities for the health, education and other welfare programmes.

Q5) Discuss about the guidelines of HR policy.          8

A5) The guidelines for formulation of HR policy are-

1. Clear and specific, yet flexible enough to meet the changing conditions.

2. Compliance with all appropriate law and regulation.

3. Agreement with one another and reflection of an overall true and fair view approach to all employees.

4. Identify the purpose and objectives which the organization wish to attain regarding to its Human Resources department.

5. Analyse all the factors under which the organization’s HR policy will be operating.

6. Examining the possible alternatives in each area which the HR policy statement is necessary.

7. Implementation of the policy through the development of a procedure to support the policy.

8. Communication of the policy and procedures adapted to the entire organization.

9. Auditing the policy so as to reveal the necessary areas requiring change.

10. Continuous revaluation and revision of policy to meet the current needs of the organization.

11. Gain understanding of the corporate culture and its shared values.

12. Analyse existing policies: both written and unwritten existing policies.

13. Analyse external influences as HR policies are subject to the influence of many legislation, regulations and authorities, thus the codes of practice issued by the professional institutions, should also be consulted.

14. Assess any areas where new policies are needed or existing policies are inadequate.

15. Check with managers, preferably starting at the top, on their views about HR policies and where they think could be improved.

16. Seek the view of employees about the HR policies, especially to the extend for which they are inherently fair and equitable and are implemented fairly and consistently.

17. Seek the view of the union’s representatives.

18. Analyse the information retained in the previous steps and prepare the draft policies.

Q6) Explain the steps involved in HR policy.     5

A6) Steps in Formulation of HR Policies are:

Figure: Steps in HR policy formulation

1. Identify the Areas:

The areas where HR policies are needed are to be identified. Important areas of HR like recruitment, selection, training, compensations must have specific policies clearly spelt out. If need arises, additional policies may have to be formulated for dealing with newer HR issues.

2. Collecting Data:

After selecting the areas, relevant information should be collected for facilitating policy formulation. The company’s records, past practices, industry practices and top management policies should be studied. The organizational culture and employee aspirations should also be taken into account while formulating policies.

3. Evaluating Alternatives:

Once data have been collected, various alternative policies can be designed. Each alternative has to be evaluated in terms of their contribution towards the desired objectives. The policies should be for the betterment of the existing HR system and formulated in congruence with other organizational policies. The policies should be finalised after discussion with those people who are directly affected by its implementation.

4. Communicating the Policy:

The policy details should be conveyed to all the workers throughout the organization. Policy manual, in-house journals, notice boards, intranet, etc., can be used to create awareness among employees at various levels. Special communi­cation programmes can be conducted to inform all the concerned people about the new policy.

5. Evaluation of the Policy:

Policies should be evaluated regularly at periodic intervals to ascertain their effectiveness. The actual policy results should be compared with predetermined standards to check if the policy was successful in achieving its objectives. Policies may be reviewed at the organizational level, or outside experts may be invited to review it.

Q7) Discuss about the evolution and development of HRM.    5

A7) The development of human resources management concept is as follows:

Industrial revolution brought the three major developments. Due to the industrial revolution, people specialized in their job. Workers organized themselves into trade unions to achieve better conditions of employment. Labor laws were enacted to protect the interest of worker. Collective bargaining between labor and management was used to settle industrial disputes. Robert Owen reduced working hours and built houses and schools for workers. After industrial revolution, problems related to human resources led towards taking care of employees. It can be considered as the first stage of human resources development.

2.     Scientific management movement stage:

This stage aimed at improving worker efficiency through proper selection, training and compensation. F.W. Taylor suggested the following tips-

3.     Industrial psychology:

An employee having positive attitude can faster industrial efficiency. Efficiency can be increased by testing intelligence test of the employee. Thus to increase the efficiency, human psychology should be studied through different test and should developed a good interest, and positive attitude on the work in them.

4.     The human relation movement stage:

This stage focuses people element in personnel management. Hawthorne studies serve as the beginning of human relation movement. It advocates the following personnel management aspects.

5.     The period of labor legislation:

To control, direct and motivate the labor, there should be strong need of some kinds of legislation. The civil right act was passed in 1964. Discrimination law, pension laws, health and safety laws, federal regulatory agencies and their interpretive, guidelines, and cowed ruling affected virtually every aspect of employment.

6.     Organizational development movement stage:

The organization development (OD) movement of the 1960s and 1970s was closely associated with the concept of behavioral science. The OD approach concentrates on overall organizational effectiveness, especially with regard to process how people behave in situation where they are constantly interacting with one another. Team development and management of change were often important features of an OD programme. Particular attention was paid to the analysis of group process and OD consultants evolved methods of analyzing organization behavior, especially within and between group, and of solving conflict problems

Q8) Explain briefly the emerging challenges faced by the HRM.       8

A8) Human resource management is a challenging work because the human resources differ in terms of culture, attitude, fatigue, gender, expectations, family background etc. The emerging challenges faced by HRM are discussed below-

Figure: Challenges of HRM

1. Workforce Diversity:

An important challenge that human resource managers face involves workforce diversity, i.e., the increasing heterogeneity of organisations with the inclusion of employees from different groups such as women, physically disabled persons, retired defence personnel, backward classes, ethnic groups, etc. Whereas globalisation focuses on differences between personnel from different countries, workforce diversity addresses differences among people within the same country. For instance, more and more women have been joining the organisations in India and women executives have also been occupying important positions at the middle and top levels in the organisations. This in itself is a challenge for organisations as, traditionally, the Indian society has been male dominated. Workforce diversity has significant implications for the management. The managers will be required to shift their approach from treating each group of workers alike to recognizing differences among them and following such policies so as to encourage creativity, improve productivity, reduce labour turnover and avoid any sort of discrimination. When workforce diversity is managed properly, there would be better communication, better human relations and congenial work culture in the organisation.

2. Meeting Aspirations of Employees:

There has been a rise in the proportion of employees in today’s industries who belong to the younger generations whose aspirations are different from those of the earlier generations. Today’s workers are more careers oriented and are clear about the lifestyle they want to lead. Considerable changes have been noted in the career orientation of the employees. They are becoming more aware of their higher level needs and this awareness would intensify further among the future employees. The managers would be required to evolve appropriate techniques to satisfy the higher level needs of the employees and develop suitable plans for their career advancement.

3. Empowerment of Employees:

There has been a general change in the profile of workforce in industrial and other organisations. The organisations in future will get better qualified and career oriented young employees. The proportion of professional and technical employees will also increase as compared to the blue collared employees. They will seek greater degree of participation in goal setting and decision-making and also demands greater avenues of self-fulfilment. To respond to these demands, organisations will have to be redesigned or restructured to empower the employees so that they have sufficient autonomy or freedom to take decisions while performing their jobs. Empowerment involves giving the employees more information and control over how they perform their jobs. Various techniques of empowerment range from participation in decision-making to the use of self-managed teams. In future, organisations will follow team structures which will pave the way for empowerment of lower levels. Empowerment would be all the more necessary to speed up the process of decision-making, make use of environmental opportunities and to serve the customers and society better.

4. Management of Human Relations:

Management of human relations in the future will be more complicated than it is today. “Many of the new generation of employees will be more difficult to motivate than their predecessors. This will in part be the result of a change in value system coupled with rising educational levels. Greater skepticism concerning large organisations and less reverence for authority figures will be more common. Unquestioning acceptance of rules and regulations will be less likely. Since workforce in future will comprise better educated and self-conscious workers, they will ask for the higher degree of participation and avenues for self- fulfilment. Moreover, the proportion of professional and technical employees will increase in relation to blue-collar workers. The ratios of female employees in the total workforce wall also rise. Integration of women within managerial ranks might itself be a problem. Money will no longer be the sole motivating force for majority of the workers. Non-financial incentives will also play an important role in motivating the workforce. In short, human resources will be treated as assets which will appear in the Balance Sheets of business organisations in future.

5. Dynamic Personnel Policies and Programs:

The Human Resource Manager of tomorrow will not only look after personnel functions, but will also be involved in human resource policies and programs for the entire organisation. Similarly, human resource management is not merely going to be an exclusive job of the HR Manager, but every executive in the organisation would be made responsible for the effective management of people in his unit. Thus, management of human resource will receive greater attention of all managers from top to bottom. The human resource manager would play a key role in the formulation of personnel policies, programs, plans and strategies of the organisation. Every HR program will have to be properly planned and directed by the human resource manager in consultation with the line and functional managers.

6. Building Responsive Organisation:

The Human Resource Manager will have to contribute tremendously to the building up of responsive organisation. Creating adaptive customer-oriented organisation would require soliciting employees’ commitment and self-control and encouraging empowerment of employees. Instead of imposing himself as the traditional boss, the future manager will have to think of himself as a ‘team-leader’, ‘internal consultant’ and ‘change facilitator’.

7. Creating Dynamic Work-Culture:

The human resource manager will have to mobilise a new work ethic so as to assist the top management in setting up and enforcing quality standards. Greater efforts will be needed to achieve group cohesiveness because workers will have transient commitment to groups. As changing work ethic requires increasing emphasis on individuals, jobs will have to be redesigned to provide challenge to the employees. Flexible starting and quitting times for employees [flexitime] may become necessary. Further, focus will shift from extrinsic to intrinsic motivation of employees. In future, changes will have to be initiated and managed to improve organisational effectiveness. A work culture conducive to absorption of changes in the technological, economic, political, socio-cultural and international environment will have to be nourished by the HR/Personnel executives if they want to acquire higher status in industry and society. They will also have to make top management more actively involved in the development of human resources for meeting the challenges of environment and enhancing organisational effectiveness. Over the years, human resource management has emerged as a discipline in its own right and the HR manager as a professional. Professional dynamics will enhance its prestige and quality of service. However, its survival and success in future will depend upon the judicious application of knowledge and skills available. Human resource management will emerge as a well-established, well-respected and well-rewarded profession, comparable to other established professions provided the challenges and opportunities are successfully exploited for its advancement.

8. Building Core Competence and Creating Competitive Advantage:

The human resource manager has a great role to play in developing core competence by the firms. A core competence is a unique and inimitable strength of an organisation which may be in the form of human resources, marketing capability, or technological capability. If the business is organised on the basis of core competence, it is likely to generate competitive advantage. Because of this reason, many organisations have restructured their business by divesting those business activities which do not match core competence or acquiring those business activities which fit their core competence such as Gujarat Ambuja acquiring cement companies and Reliance Industries acquiring yam companies. In fact, organisation of business around core competence implies leveraging the limited resources of the firm. It needs creative, courageous and dynamic leadership having faith in the organisation’s human resources. In today’s globalized market piece, maintaining a competitive advantage is the foremost goal of any business organisation. There are two important ways a business can achieve a competitive advantage. The first is cost leadership which means the firm aims to become the low-cost leader in the industry. The second competitive strategy is differentiation under which the firm seeks to be unique in the industry in terms of dimensions that are widely valued by the customers. Putting these strategies into effect carries a heavy premium on having a highly committed and competent workforce. Such a workforce would enable the organisation to compete on the basis of market responsiveness, product and service quality, differentiated products and technological innovation. Creation of competent and committed workforce is a great challenge for the human resource manager.

9. Outsourcing HRM Functions:

These days, many organisations are outsourcing routine HRM functions so as to focus on strategic HR issues that affect corporate performance and shareholder value. The HRM functions which are of routine type and can be safely outsourced include recruitment, selection, compensation, job evaluation, training, etc. Outsourcing of such functions would enable the management pay greater attention to core business activities. The term ‘outsourcing’ means getting some service from external service providers or agencies rather than performing it within the organisation. This practice is called Business Process Outsourcing (BPO). The basic feature of BPO is that companies hire out on contract those services or tasks which fall outside the area of their ‘core competence’.

Q9) Write a brief note on workforce diversity.     5

A9) Workforce diversity means the heterogeneous composition of employees of an organization in terms of age, gender, language, ethnic origin, education, marital status, etc. Managing such diversity is really a challenge to HRM professionals. According to Moorhead and Griffin – “Workforce diversity is concerned with the similarities and differences in such characteristics as age, gender, ethnic heritage, physical abilities and disabilities, race, and sexual orientation, among the employees of organisations.”

Classification of workforce diversity

The characteristics that describe the workforce of an organisation may be categorized under two groups, namely, primary dimensions and secondary dimensions.

Figure: Classification of workforce diversity

i. Primary Dimensions:

These are core elements about each member of the workforce that can’t be changed such as age, race, gender, physical and mental abilities and sexual orientation. These inborn elements are interdependent and exert an important influence on individual’s behaviour throughout the life. Together they form an individual’s ‘self-image’. Gender diversity is increasingly apparent throughout the world. Not only are more women working, but gender-based occupational segregation is also declining in many countries. Thus, within corporations men and women are more likely to be found working side-by-side. Age diversity is increasing too. Many industrialized countries are experiencing declining rates of population growth, which push employers to hire both young and older employees. Furthermore, as organisations allow the higher education of younger employees to substitute for the job experiences that previous cohorts of employees had to accrue in order to be promoted, relatively young employees are found more often in higher level positions. Consequently, age diversity is replacing the homogeneity associated with traditional age-based stratification. The greater the number of primary differences between people, the more difficult it is to establish trust and mutual respect. Culture clash and conflicts that occur between groups of people with different core identities can have a devastating effect on human relations in an organisation. Few organisations are immune to the problems that result from the interaction between the genders and among the generations. When we add the secondary dimensions of diversity to the mix, effective human relations become even more difficult.

Ii. Secondary Dimensions:

These constitute the elements that can be changed or at least modified. They include a person’s health habits, religious beliefs, education and training, general appearance, status relationship, ethnic customs, communication style and level of income. All these factors add an additional layer of complexity to the way we see ourselves and others and in some instances can exert a powerful impact on our core identities. An accountant with ten years of work experience might adjust to a new position far differently from an accountant with much less experience. A male earner who loses his job may be severely affected by his loss of income as he has to cater to his familial demands whereas a married woman with no children may not be as affected by a similar loss as her husband can still meet the requirements of the family. Even though situations like these intensify the impact of particular secondary dimensions, they do not diminish the impact of primary or core dimensions. Instead, the interaction between primary and secondary dimensions shapes a person’s values, priorities and perceptions throughout life.

Q10) Discuss about the factors responsible for workforce diversity in an organisation.   5

A10) The responsible factors of workforce diversification of an organisation are discussed below-

Figure: Factors for workforce diversification

(1) Expansion of the services sector – The services sector jobs, such as banking, tourism, and retailing entail lots of inter­action with customers of diverse backgrounds and cultural moorings. In order to sell to a diverse customer base, and because customers tend to prefer to buy from people of the same background, organizations these days have realized the need of a diverse workforce.

(2) Globalization of markets – To satisfy needs and preferences of global customers, organizations have to get closer to their customers. Some organizations have established a strong local presence (for example, American companies advertising their products like soft drinks) while others have forged international alliances (for example, Maruti Udyog Limited (MUL) having alliance with Suzuki of Japan for automobiles manufactures). Either way, diversity gets introduced and must be managed.

(3) Requirement of teamwork for successful implementation of business strategies – For success in business, organizations rely heavily on teamwork. Diversity is an inevitable by-product of teamwork, especially when teams are drawn from a diverse base of employees.

(4) Mergers and alliances – As mergers and alliances become commonplace, it has become impor­tant that the corporate culture of the merging entities work together. Workforce diversity, then, becomes inevitable and desirable for the success of such mergers and alliances.

(5) Changing labour market – The rapidly changing labour market is also responsible for injecting diversity in workforce. Increasing demand for knowledgeable workers and also more and more women taking up jobs add an important dimension in workforce diversity.

(6) Constitution and government laws – Under the provisions of the Constitution of India, certain portion of jobs in the government and public sector are reserved for scheduled castes, sched­uled tribes, other backward classes, physically challenged, etc. It inevitably leads to diversity in workforce.

Q11) Write a brief note on employee empowerment of an organisation.       8

A11) Employee empowerment is defined as the ways in which organizations provide their employees with a certain degree of autonomy and control in their day-to-day activities. This can include having a voice in process improvement, helping to create and manage new systems and tactics, and running smaller departments with less oversight from higher-level management. A key principle of employee empowerment is providing employees the means for making important decisions and helping ensure those decisions are correct. When deployed properly, this should result in heightened productivity and a better quality of employee work and work life. Employee empowerment varies based on an organization's culture and work design. However, empowerment is based on the concepts of job enlargement and job enrichment.

Figure: Elements of empowerment of employee

The benefits of employee empowerment are-

Empowering employees through greater autonomy has been directly linked to increased employee motivation. Experts agree that employees who have more control over how, when, and where they do their job will work harder and find their work more engaging.  And given the chance to show off what they can do, employees will put their best foot forward and feel more satisfied at the end of the day.

2.     Greater trust in leadership

A meta analysis published in Harvard Business Review states that leaders who empower their employees are more likely to be trusted by their subordinates compared to leaders who do not empower their employees. This is not to say that empowering employees involves pushing work onto underlings that managers don’t feel like doing themselves. Leaders who empower their employees act as coaches, pushing their employees to do their best work and supporting them along the way. Empowered employees felt that their leaders would not take advantage of their hard work ー instead, they would recognize and celebrate their wins.

3.     Improved creativity

In the same Harvard meta analysis, leaders who were perceived as empowering had direct reports who were more likely to be rated by their colleagues as being highly creative. Unsurprisingly, subordinates who allowed their employees to think for themselves and collaborate across teams generated more novel ideas. Not only that, direct reports who felt empowered were more likely to volunteer for extra assignments and support their organizations outside of their day-to-day job function. Psychologists suspected that empowered individuals were more committed to meaningful goals, and used their creativity to achieve them.

4.     A stronger bottom line

At the end of the day, companies that promote employee empowerment are simply performing better than those that don’t. Businesses with highly motivated workers are 21 per cent more profitable.

Q12) Define downsizing? Discuss the reasons for downsizing in an organisation.   8

A12) Downsizing means reducing the strength of employees through planned elimination of positions and jobs. Because of global competition most of the companies want to reduce costs and be competitive. Downsizing literally means reducing the size of the organisation in order to cut costs, hive off unprofitable operations and improve operational efficiency. In other words, Downsizing refers to reduction of the size of the organization by resorting to reducing costs by writing off unprofitable operations and improving organizational efficiency. The first causality is the number of workers employed, and since 1992 many Indian companies have resorted to downsizing by introducing VRS. It is spreading fast, and has affected many enterprises in different sectors.

Organizations may go for downsizing for a variety of reasons; some of the major ones include the following:

Figure: Reasons of downsizing

1. Over-Staffing:

Due to faulty HR planning or to fulfil social com­mitment, some organizations may employ more employees as against their actual requirement. Most government departments and public sector enterprises of Government of India face the problem of over-staffing. This is because the government has the social responsibility to reduce unemployment in the country.

2.  Economic Recession:

Recently, many organizations, under the pressure of the global economic recession, downsized their organizations by laying off or retrenching employees. For example, Tata Motors laid off 6,000 temporary workers to tide over economic recession. Citigroup, an American financial company, axed 52,000 jobs globally, and its Indian arm, Citi India, laid off 37 employees, including senior executives.

3.  Technological Advancements:

In the present times, rapid developments are taking place on the technology front. Automation, computers, and the internet have changed the way business operations are carried out. Due to this, the man-machine ratio has undergone a drastic change. Today, an organization requires less manpower to perform the same amount of work, if not more. Thus, technological developments made downsizing of organizations some­what inevitable.

4.  Outsource Non-Core Activities:

To be successful in today’s competitive environment, most organizations prefer to concentrate on activities in which they have core competence and outsource non-core activities. As a result, people employed in non-core activities become surplus, thereby necessitating the need to downsize the organization.

Q13) Discuss about the advantages of downsizing.          10

A13) Downsizing has several key benefits that can put an organization back on the road to financial health and stability which are discussed below-

Figure: Advantages of downsizing

1. Helps in saving business – It helps the company to bring the business on track. The unnecessary activities that were redundant would be done away with.

2. Results in bringing transparency – Downsizing companies would need to make results transparent for the employees to see the real trends. In fact, transparency brings in more co-operations within the group and within team.

3. Results in Lean Management and Lean operations – When the company downsizes it would be operating at reduced costs by avoiding unnecessary expenditures and looking into details of any process to see that there is no unnecessary costs. This way the profits increase and the company is said to perform under lean management.

4. Retains talent – It helps in retaining the more talented taskforce. This cannot be achieved in short span of time but needs to be taken care of during the performing time itself.

5. Brings in team work – As team gets smaller, the management would need to focus on rebuilding the new team by focusing on trainings, incentive programmes. This would create loyalty, motivation and empowers them directly impacting on productivity.

6. Strengthen relations – Through the process of downsizing, the company can take measures of reducing the working hours. It could be in terms of days per week or hours per day. It might impact some workers who would leave but those who stay back are the loyal team who the company relies on. Their loyalty strengthens the relation between employer and employee.

7. Helps in running business at optimal level – Downsizing actually brings in cuts and changes to all the departments in the organization. Hence, there is a balance created within each section which contributes to the cost cutting approach. Due to this everyone is involved in allowing the business to run at optimal.

8. Direct interaction of top level management – As downsizing is a way to reduce all round costs, the top management that did not involve in day to day activities would do so hereafter. This way the owner of the business would be involved in decision making of all the projects or tasks.

9. Helps in re-evaluating business – Re-evaluating helps the company to rewrite its business plans to suit to the market trends. This helps the business to review and update its policies, procedure of operation and bring changes.

10. Helps in bringing to manageable size – Downsizing is actually to reduce the operations and size of the department so that it is manageable. It helps the business to serve customers efficiently as the situation is manageable. When the situation is manageable the profit is good.

Q14) Write a brief note on VRS.    8

A14) VRS stands for voluntary retirement scheme, whereby an employee is offered to voluntarily retire from services before the retirement date. The scheme allows companies to reduce the strength of employees. It can be implemented by both the public and private sectors. VRS is also known as 'Golden Handshake'. Indian labour laws do not allow direct retrenchment of employees under a union. According to the Industrial Disputes Act, 1947, employers cannot reduce excess staff by retrenchment. In fact, any plans of retrenchment and reduction of staff and workforce are subjected to strong opposition by trade unions. So, VRS was introduced as an alternative legal solution to solve this problem. The voluntary retirement scheme was not vehemently opposed by the Unions, because it is 'voluntary' in nature and not compulsory. VRS applies to employees who have completed 10 years of service or are above the age of 40 years. It applies to workers, executives of companies and/or to an authority of a co-operative society (except company/co-operative society directors). As per the rules, voluntary retirement scheme should result in an overall reduction in the existing strength of employees and the vacancy cannot be filled up. PSUs have to obtain prior approval of the government before offering voluntary retirement. Firms can frame different schemes, however, they must conform to the guidelines under section 2BA of the Income-Tax Rules. One of the pertinent rules clearly states that retiring employee must not be employed in another firm belonging to the same management. Private and public sector firms can opt for VRS under the following circumstances:

To be eligible for this scheme, the following criteria must be met:

The employee who opts for VRS is entitled to get:

For example, in 2019, state-run telecom operator BSNL announced VRS for its employees after the decision to merge other PSU telco MTNL. As per media reports, over 92,000 BSNL, MTNL staffers opted for VRS.

Features of VRS

Here are some characteristics of the scheme:

Benefits of VRS

Voluntary retirement scheme offers a host of benefits for the company as well as the employee. Such benefits are:

Q15) What is human resource information system? Also discuss its advantages.  8

A15) The Human Resource Information system is a system for recruitment, performance management, learning & development, and more. An HRIS is also known as HRIS software. The HRIS is a system that is used to collect and store data on an organization’s employees. In most cases, an HRIS encompasses the basic functionalities needed for end-to-end Human Resources Management (HRM). The HRIS is, in essence, an HR software package. The HRIS can either run on the company’s own technical infrastructure, or, more common nowadays, be cloud-based. This means that the HR software is running outside of the company’s premises, making it much easier to update. Human resource information system (HRIS) is defined as a software or online solution that is used for data entry, data tracking, and data management of all human resources operations of an organization. It is thus an accessible, actionable database that enables the smooth operation of all HR systems hosted either on the organization’s server, the cloud, or on that of an outsourced vendor. An HRIS is often referred to an HRMS (human resources management system) since it aids in effective human resource management and planning. An HRIS includes under its umbrella a wide range of systems. For example, it includes all aspects of managing the employee database and directory, applicant tracking, benefits administration, payroll processes, work scheduling, time and attendance, leaves tracking, electronic signatures, compliance protocols, customizable insight reports, employee self-service, performance management, and HR processes taken care of on mobile apps.

The benefits of HRIS are discussed below-

An HRIS is a record-keeping system that keeps track of changes to anything related to employees. The HRIS can be seen as the single source of truth when it comes to personnel data.

2.     Compliance 

Some data is collected and stored for compliance reasons. This includes material for the identification of employees in case of theft, fraud, or other misbehaviours, first contact information in case of accidents, citizens identification information for the tax office, and expiration dates for mandatory certification. All this information can be stored in the HRIS. It is essential that data is stored safely and securely, in line with GDPR regulations. 

3.     Efficiency

Having all this information stored in one place not only benefits accuracy but also saves time. Some companies still keep a lot of data about employees as physical paperwork. Finding the right folder, and locating the right sheet, can take up a lot of staff time. 

4.     HR strategy 

The HRIS permits the tracking of data required to advance the HR and business strategy. Depending on the priorities of the organization, different data will be essential to track. This is where the HRIS shines. 

5.     Self-Service HR

A final benefit is the ability to offer self-service HR to employees and managers. This enables employees to manage their own affairs. When done right, the HRIS can offer a good employee experience. Keep in mind that not all HRIS systems offer this in a user-friendly manner.