Course Directors :- Prof. W.M.Jayarathne
Mr. T.B .Andarawewa.
Postgraduate Diploma in Management (PGDM) Leading to the Degree in Master of Business Administration
Semester I 2007 Examination
PGDM 1132 Principles of Management
10 commandments AMA
Postgraduate Diploma in Management (PGDM) Leading to the Degree in Master of Business Administration
Semester I 2007 Examination
PGDM 1132 Principles of Management
Lecture:- Understanding communication
Lecture:-Understanding communication Technology
Lecture:-Formal Vs. Informal Communication
Lecture :-Systems Approach
Lecture :-Organizational Environment
free download Link :- http://docs.google.com/present/edit?id=0ARgnCjPFOmSuZGY2ZmtuN3pfMHM2NjhocmZ0&hl=en
French & Raven’s Five bases of Power
In a notable study of power conducted by social psychologists John French and Bertam Raven in 1959 power is divided into five separate and distinct forms. As we know leadership and power are closely linked. This idea shows how the different forms of power affect one’s leadership and success. This idea is used often in organizational communication and throughout the workforce. “The French-Raven power forms are introduced with consideration of the level of observability and the extent to which power is dependent or independent of structural conditions. Dependency refers to the degree of internalization that occurs among person’s subject to social control. Using these considerations it is possible to link personal processes to structural conditions”. (Donald Warren 1968) (Lazarfeld and Menzel 1961) French & Raven introduce five bases of power Coercive, Reward, Legitimate, Referent, and Expert.
(1) Coercive Power
This type of power is based upon the idea of coercion. This involves forcing someone to do something that they do not want to do. The ultimate goal of coercion is compliance. According to Changingminds.org “demonstrations of harm are often used to illustrate what will happen if compliance is not gained”. French & Raven (1959) state that “other forms of power can also be used in coercive ways, such as when reward or expertise is withheld or referent power is used to threaten social exclusion”. The power of coercion has been proven to be related with punitive behavior that may be outside one’s normal role expectations. (Hinkin & Schriesheim 1989) However coercion has also been associated positively with generally punitive behavior and negatively associated to contingent reward behavior.(Gioia & Sims 1983) This source of power can often lead to problems and in many circumstances it involves abuse. Mindtools.com states that “coercive power can cause unhealthy behavior and dissatisfaction in the workplace”. These type of leaders rely on the use of threats in their leadership style. Often the threats involve saying someone will be fired or demoted.
(2) Reward Power
The second type of power involves having the ability to administer to another things he/she desires or to remove or decrease things he/she does not desire. (French & Raven 1959) For supervisors in an organizational setting, it is the perceived ability to present subordinates with outcomes that are valued in a positive manner. (Hinkin & Schriesheim 1989) This type of power in based on the idea that we as a society are more prone to do things and to do them well when we are getting something out of it. Social exchange theorists as well as Power-Dependence theorists continue to focus on the idea of reward power. (Molm 1988) The most popular forms are offering raises, promotions, and simply compliments. The problem with this according to Mindtools.com is that “when you use up available rewards, or the rewards don’t have enough perceived value to others, your power weakens. (One of the frustrations with using rewards is that they often need to be bigger each time if they’re to have the same motivational impact. Even then, if rewards are given frequently, people can become satisfied by the reward, such that it loses its effectiveness.)”
(3) Referent Power
The power of holding the ability to administer to another feelings of personal acceptance or personal approval. (Hinkin & Schriesheim 1989) This type of power is strong enough that the power-holder is often looked up to as a role model. (Raven, 1988) This power is often looked at as admiration, or charm. The power derives from one person having an overall likability leading people to strongly identify with them in one form or another. A person with this type of power generally makes people feel good around them therefore one has a lot of influence. The responsibility involved is heavy and one can easily lose this power, but when combined with other forms of power it can be very useful. Celebrities often have this type of power in society on the flip side they also often lose it quickly in some circumstances.
(4) Expert Power
The ability to administer to another information, knowledge or expertise. (French & Raven 1959) Leaders who possess this type of power have high intelligence and rely on their ability to perform various organizational tasks and functions. This power makes one able to combine the power of reward in the correct fashion. When someone has the expertise in an organization people are more convinced to trust them and to respect what they stand for. When your expertise is valued, so are your ideas, and leadership.
Leadership: A Chinese Puzzle
Tailor’s Time and Motion Studies
14 Principles in Management by Fayol
Laissez fair Philosophy
Laissez faire is short for “laissez faire, laissez passer,” a French phrase meaning to “let things alone, let them pass”. First used by the eighteenth centuryPhysiocrats as an injunction against government interference with trade, it is now used as a synonym for strict free market economics. Adam Smith played a large role in popularizing laissez-faire economic theories in English-speaking countries.
Laissez faire (imperative) is distinct from laisser faire (infinitive), which refers to a careless attitude in the application of a policy, implying a lack of consideration, or thought.
The laissez-faire school of thought, or libertarianism, holds a pure capitalist or free market view, that capitalism is best left to its own devices — that it will dispense with inefficiencies in a more deliberate and quick manner than any legislating body could. The basic idea is that less government interference makes for a better system.
Laissez-faire philosophy was dominant in the late 19th and early 20th century in the wealthier countries of Europe and North America. Many historians also see that period as the height of laissez-faires implementation in those countries. However, there are critics who suggest that what was described as “laissez-faire” policy was simply pro-business policy, as with large subsidies for businesses to produce the railroads in the United States or the common use of tariffs by Republican presidents there. In this context, laissez-faire rhetoric was used to justify denial of similar subsidies to the poor and working classes.
For many, laissez faire theories fell into disrepute because of their failure to allow governments to deal with managing the economy during and after World War I, and their alleged failure to prevent The Great Depression. However, some libertarians, such as Milton Friedman andAlan Greenspan, argue that by the time of the Great Depression, significant government economic regulation had already taken place in most major economies, as workers and employees in all industries organized themselves into trade unions to demand better living standards, as well as various checks and balances to the perceived “tyranny of laissez faire”. Workers succeeded in obtaining minimum wage laws and aprogressive income tax in some countries. International trade barriers were also in the policy pipeline (e.g. Smoot-Hawley Tariff in the USA). So, according to the above-mentioned libertarians, the economies that suffered from the Depression, although possibly closer to laissez-fairethan any other economic models that were ever used, still did not embrace pure capitalism. Some critics of laissez faire argue that the attainment of pure capitalism is impossible, for example since it is difficult to deal with market failures without an active role for government.
Modern industrialised nations today are not typically representative of laissez-faire principles, as they usually involve significant amounts of government intervention in the economy. This intervention includes minimum wages, significant redistribution through tax and welfare programs, government ownership of businesses and regulation of market competition. However, many suggest that President Ronald Reaganof the United States and Prime Minister Margaret Thatcher of the United Kingdom followed a generally laissez-faire perspective.
In the wake of the rise of the USSR, laissez-faire economics assumed a stronger ideological edge, see e.g. Hayek. In the post-war era, where state regulation and involvement in the economy reached a peak, to no small extent as part of the Cold War, anti-statist schools of economic thinking enjoyed a surge of interest and support.
The term labour movement or labor movement is a broad term for the development of a collective organization of working people, to campaign in their own interest for better treatment from their employers and governments, in particular through the implementation of specific laws governing labour relations. Labour unions and trade unions are collective organizations within societies, organized for the purpose of representing the interests of workers and the working class. Many elite-class individuals and political groups may also be active in and part of the labour movement.
MASLOW’S HIERARCHY OF NEEDS
from Psychology – The Search for Understanding
by Janet A. Simons, Donald B. Irwin and Beverly A. Drinnien
West Publishing Company, New York, 1987
Abraham Maslow developed a theory of personality that has influenced a number of different fields, including education. This wide influence is due in part to the high level of practicality of Maslow’s theory. This theory accurately describes many realities of personal experiences. Many people find they can understand what Maslow says. They can recognize some features of their experience or behavior which is true and identifiable but which they have never put into words.
Maslow is a humanistic psychologist. Humanists do not believe that human beings are pushed and pulled by mechanical forces, either of stimuli and reinforcements (behaviorism) or of unconscious instinctual impulses (psychoanalysis). Humanists focus upon potentials. They believe that humans strive for an upper level of capabilities. Humans seek the frontiers of creativity, the highest reaches of consciousness and wisdom. This has been labeled “fully functioning person”, “healthy personality”, or as Maslow calls this level, “self-actualizing person.”
Maslow has set up a hierarchic theory of needs. All of his basic needs are instinctoid, equivalent of instincts in animals. Humans start with a very weak disposition that is then fashioned fully as the person grows. If the environment is right, people will grow straight and beautiful, actualizing the potentials they have inherited. If the environment is not “right” (and mostly it is not) they will not grow tall and straight and beautiful.
Maslow has set up a hierarchy of five levels of basic needs. Beyond these needs, higher levels of needs exist. These include needs for understanding, esthetic appreciation and purely spiritual needs. In the levels of the five basic needs, the person does not feel the second need until the demands of the first have been satisfied, nor the third until the second has been satisfied, and so on. Maslow’s basic needs are as follows:
1. There is no universal or one best way to manage
2. The design of an organization and its subsystems must ‘fit’ with the environment
3. Effective organizations not only have a proper ‘fit’ with the environment but also between its subsystems
4. The needs of an organization are better satisfied when it is properly designed and the management style is appropriate both to the tasks undertaken and the nature of the work group.
There are also contingency theories that relate to decision making (Vroom and Yetton, 1973). According to these models, the effectiveness of a decision procedure depends upon a number of aspects of the situation: the importance of the decision quality and acceptance; the amount of relevant information possessed by the leader and subordinates; the likelihood that subordinates will accept an autocratic decision or cooperate in trying to make a good decision if allowed to participate; the amount of disagreement among subordinates with respect to their preferred alternatives.
Human Resources Management
Human Recourses Mgt is a widely discussed subject today. Though the concept is started way back through human evolution until the industrial revolution it was not introduced systematically or developed. There after, through research and development it has taken up various changes right through the journey. In 21st century HRM becomes a vital function among the other functions of the management in an organization.
Though it is widely recognize by the world today at the beginning of 18th century this vital area had been practiced in a separate manner in the western as well as the Eastern parts of the world individually.
With the globalization and the international competitive environment the eastern strategies of HRM was deteriorated and HRM existing with the western influence.
This study will:
- Discuss the evolution of human resources Management;
- Compare and analyze Eastern and Western modules practiced earlier;
- Propose a module which suite to Sri Lanka.
- 2. Introduction
- Human Resources (or personnel) management in the sense of getting thing done through people. It’s an essential part of every manager’s responsibilities, but many organizations find it advantageous to establish a specialist division to provide an experts service dedicated to ensuring that the human resources function is performed efficiently.
- “People are the most valuable asset in an organization” is a cliché which no member of any senior management team would disagree with. Yet, the reality for many organizations is that their people remain undervalued, under trained, underutilized, poorly motivated, and consequently perform well below their true capability.
- The rate of changes faced by the organizations today has never been greater and organizations must absorb and manage these changes at a much faster rate than ever before. In order to implement a successful business strategy to face this challenge, organizations, large or small, must ensure that they have the right people capable of delivering the strategy to achieve organizational objectives.
- The laborer market place for talented, skilled people is competitive and expensive. Taking on new staff can be disruptive to existing employees. Also, it takes time to develop ‘cultural awareness’, product/ process/ organization knowledge and experience for new staff members.
- As organizations vary in size, aims, functions, complexity, construction, the physical nature of their product, and appeal as employers, so do the contributions of human resource management. But, in most the ultimate aim of the function is to: “ensure that at all times the business is correctly staffed by the right number of people with the skills relevant to the business needs”, that is, neither overstaffed nor understaffed in total or in respect of any one discipline or work grade.
- 3.History of Human Resources management & Western
3.1 The ageless search for better ways
- It’s, known that from earliest recorded times groups of people have been organized to work together towards planned goals. Their efforts coordinated and controlled to achieve such outcomes. Though the term scientific management did not come into being well into the Industrial Revolution (the latter half of the 19th century,) its history is, on reflection, much longer than the term itself. Consider the management skills required, by the ancient Egyptians to build their pyramids, by the ancient Chinese to build the Great Wall of China, the management skills of the Mesopotamians to irrigate their land and wall their cities, of the Romans when building their roads, aqueducts and Hadrian’s Wall. All these man-made constructions required large amounts of human effort and therefore organization i.e. planning, control and coordination. The Great Pyramid for example is 75600 square feet at its base, 480 feet high, and contains over 2 million blocks of stone, each weighing 2.5 tons. The base of the structure is only 7 inches from being a perfect square. This was achieved with no computer, electronic calculator, modern materials handling equipment or advanced mathematical techniques/ models.
- 3.2 Scientific Management – some earlier contributors.
- The Chinese philosopher Mencius (372-289BC) dealt with conceptual models and systems known to be as production management techniques. He highlighted the advantages of the division of labor. Records indicate that the ancient Greeks understood the advantages of, and practiced, uniform work methods. Their soldiers were instructed as to how their weapons and equipment should be laid out in case of a surprise attack. They also employed work songs to develop a rhythm, in order to achieve a smooth less fatiguing tempo, to improve productivity. The division of labor was recognized by Plato (427-347BC). He wrote in The Republic, ‘A man whose work is confined to such limited task must necessarily excel at it’.
- 3.3 Ancient attitude to work
- However, work itself was viewed by certainly the ancient Greeks and the Romans, as disgraceful. Work was something to be avoided as it got in the way of more ideal pursuits, such as the arts, philosophy and military adventure. Therefore, those who could afford to do so employed slaves.
- 3.4 After the fall of the Roman Empire
- With the fall of the Roman Empire, development was curtailed; slavery being replaced by feudalism. In pre-Reformation Christian Europe, work was also seen as a burden, a punishment for the sins of Adam and Eve, for which reward would be found in the hereafter. In this period, the mechanical clock, invented by Heinrich von Wych in Paris in 1370, and Guttenberg’s printing press were key to all future developments in scientific management. The former permitted accurate work measurement the latter the ability to communicate by the printed word. Indeed Guttenberg’s inspired creative thinking can be viewed as an early example of method study. The story goes that Guttenberg, whilst at a wine festival, realized he could apply the technique of using dies for coin-punching with the mechanics of a wine press, to produce a printed page, and made up of individual letters instead of from a single engraved block.
- 3.5 Development during the Industrial Revolution.
- The impetus for the Industrial Revolution developed by the seventeenth century. Agricultural methods had improved in Europe to the extent that surpluses were generated. These surpluses were used for trade. Trade routes were by this time expanding, on a global scale, including those to the East and the Americas to the West. Technical advances were being made, most importantly in textile manufacturing, notably in the eighteenth century, Hargreaves’s spinning jenny, Arkwright’s water frame and Compton’s mule. The steam engine first developed in 1698 by Thomas Savory, was harnessed by James Watt. Improved hygiene and diet, including the boiling of water to make tea (from the East,) led to expanding populations. These factors, technological developments, expanding trade/ markets, growing populations created opportunities for merchants and entrepreneurs to invest in new factories.
- 3.6 The Factory System
- Adam Smith, in the eighteenth century, advocated making work efficient by means of specialization. He advocated breaking the work down into simple tasks. He saw three advantages of the division of labor; the development of skills the saving of time the possibility of using specialized tools. Following on rapidly from Smith changes in the process of manufacturing developed. After the War of Independence, there was a shortage of musket parts in the United States. Eli Whitney proposed the manufacturing of muskets by means of using interchangeable parts. Though the idea was viewed with initial skepticism, his process was successful in producing large quantities of interchangeable parts. Thus was born the process of tooling up for production. At this time Whitney developed and used techniques such as cost accounting and quality control. Records from the Soho Bell Foundry in Chelsea, around the same time as Whitney, reveal evidence of the use of production standards, cost control, work study and incentives.
- In 1832, Charles Babbage, an engineer, philosopher and researcher, examined the division of labor in his book On the Economy of Machinery and Manufacturers. His work raised important questions about production, organizations and economics. Division of Labor One factor, crucial in the latter development of incentives, Babbage proposed, as an advantage of the division of labor, that the amount of skill needed to undertake a specialized task was only the skill necessary to complete that task. He illustrated this concept by breaking down the manufacture of a pin, into seven elements. The important implication for employers was that they need only pay for the amount of skill necessary to complete each individual task. He advocated breaking down jobs into elements and costing each element. In this way, potential savings from investments in training, process and methods could be quantified. Thus these developments presaged the machine age, replacing traditional manual labor and improving productivity. Machines were located near sources of power, first water later coal for steam.
3.7 Scientific management
- In (1856-1915), Frederick Winslow Taylor devised a system he called scientific management, a form of industrial engineering that established the organization of work as in Ford’s assembly line. This discipline, along with the industrial psychology established by others at the Hawthorne Works of Western Eclectic in the 1920s, moved management theory from early time-and-motion studies to the latest total quality control ideas.
- Taylor’s ideas, clearly enunciated in his writings, were widely misinterpreted. Employers used time and motion studies simply to extract more work from employees at less pay. Unions condemned speedups and the lack of voice in their work that “Taylorism” gave them. Quality and productivity declined when his principles were simplistically instituted.
- Modern management theorists, such as Edward Deming, often credit Taylor, however, with generating the principles upon which they act. Others, such as Juran, though, continue to denigrate his work. Modern theorists generally place more emphasis on worker input and teamwork than was usual in much of Taylor’s time. A careful reading of Taylor’s work will reveal that he placed the worker’s interest as high as the employer’s in his studies, and recognized the importance of the suggestion box, for example, in a machine shop.
- According to the Toronto Globe and Mail, (1995) January 26, pp. B26, one of the popular current “re-engineering” gurus, G. Hamel, has this to say about Taylor’s ideas today:
- “When I am in a mean mood, I call re-engineering ’21st century Taylorism”
- There are three fundamental things that Frederick Winslow Taylor was emphasizing to be thought.
- 1. Find the best practice wherever it exists. Today we call it benchmarking.
- 2. Decompose the task into its constituent elements. We call it business process re-design.
- 3. Get rid of things that don’t add value. Work out, we call it now.
- “Whether it involves cycle time, quality or whatever, most of re-engineering has been about catching up.”
- Management in organizations is products of their historical and social times and places. Thus, we can understand the evolution of management theory in terms of how people have wrestled with matters of relationships at particular times in history.
- In 19th and 20thcentury Classical economists and innovators provided a theoretical background in various issues in industrially revolutionized period around the world. Towards the end of 20th century, business management came to consist of six important branches, giving prominence to Human resource management.
- Human resources management from the beginning revolved in toa strategic function concerned with consequences of all organizational decisions for human productivity and for the well-being of the entire work force. It is a distinctive approach to employment management which seeks to achieve competitive advantage through the strategic deployment of a highly committed and capable work force, using an integrated array of cultural, structural and personnel techniques.
- 4. Human Resources Management Today.
- At present, HR has the same importance as the other departments, in some corporate, it has more. With the constant increase in education, technology and frequent fluctuations in economic status and structures, it’s believed, HR is the oldest, most mature and yet, the most efficient of all management styles.
- The Human Resource Management is the process of acquiring training, appraising, and compensating by attending to their labor relations, health and safety and fairness concerns. The topics we will discuss should therefore with the concepts of and techniques need to carry out the “people” or personal aspects of the management job.
- These include;
- Conducting job analyses [determining the nature of each employees job]
- Planning labor needs and recruiting job candidate
- Selecting job candidates
- Orienting and training new employees
- Managing wages and salaries [compensating employees]
- Providing incentives and benefits
- Appraising performance
- Communicating[interviewing, counseling ,disciplining]
- Training and development
- Building employee commitment
- Why is HR management important to all Managers? Let us look at some of the mistakes made by Managers.
- Hires the wrong person for the job
- Experience the high turnover
- Find your people not doing the best
- Have your company taken to courts.
- Commit any unfair labor practices.
- It’s understood, that the managers can’t do everything. lay brilliant plans, draw clear organization charts ,set up modern assembly lines and use sophisticated accounting controls. The whole thing collapse by hiring the wrong people or by not motivating subordinates . Hiring the “right people”, for the right job and motivating ,appraising and developing them. Getting good results is the bottom line of managing and that as a manager will have to get these results through “people” .Gary Deshler,[Human Resource Management.]
- In small organizations line managers may carry all above personnel duties unassisted. But as the organization grows they need the assistance ,specialized knowledge, and advice of a separate human resource staff. The human resource department provide the specialized assistance. In doing so the HR carries out these distinct functions.
- 1 Line function
- 2 A co-coordinative function
- 3 Staff [service] function
- Look at the ma functions of human resources
4.1 HR planning and recruiting
- Personnel planning is the first in the recruiting and selecting process.
- Decide what positions have to be filled by engaging in personnel planning and forecasting.
- Build a pool of candidates for these jobs by recruiting internal or external candidates.
- Have applicants complete application forms and perhaps undergo an initial screening interview.
- Use selection techniques like tests, background investigations and physical exams to identify variable candidates.
- Finally decide who to make an offer to by having the supervisor and perhaps on the team interview the final candidate.
- 4.2 Forecasting the supply of inside candidates.
- Most firms starts with inside candidates when there is a projected opening. Here the main task is determining which current employees might be qualified for the opening. For this you need to know your current employees skills, their current qualifications .These contain data on things like performance records ,educational background promotability. They help managers which employees are available for transfer or promotion .Managers use several sample inventory and development record in which compiles qualifications ,information on each employee. The information includes education ,company sponsored courses ,carrier and development interests ,languages and skills .This is just a simple ,manual format which is filled by the employee and recorded.
- 4.3 Forecasting the supply of outside candidates.
- The first step is to develop an applicant pool. The more applicants you have the more selective you can be in your hiring. When the pool is big the techniques like interviews and tests to screen out all but the best. Effective recruiting is increasingly important today. Finding the right inducement for attracting and hiring employees can be a problem. A few years ago for an example about 47000 computer animator jobs opened worldwide ,but only 14000 animators graduated from school.
- Advertising in all types of papers is the beginning of recruiting .Other than the papers ,the vacancies or openings for the higher ranks could be advertised in magazine and more appropriate papers.
- Construction of the advertisement is very important .Experienced advertisers use a four-point guide called AIDA [attention, interest ,desire, action]to construct ads. You must of course attract attention to the add or readers may just miss or ignore .Employment ads should be very uncommon, heavy with a strong back ground .Key positions should be advertised in a separate display ads.
- Develop interest in the job. You can create interest by the nature of the job itself with lines such as “you will thrive on challenging work”. Finally make sure the ad prompts action with a statement like “call today “ or “write today for more information” Most of the employers are familiar with the sorts of things they usually cannot put in ads such as “man wanted” or “young woman preferred “ .Some do walk in interview and some are called.
- Executive recruiters are called ‘Head hunters “ are special employment agencies retained by employees to seek out top management positions. They have many contracts and are especially adopting at contracting qualified ,currently employed candidates who are looking for changes of jobs.
- 4.4 Developing and using application forms.
- Once it’s made a pool of applicants ,the selection process can begin and the application form is usually the first step in this process. A filled in form provides four types of information .
- First you can make judgments on substantive matters ,such as whether the applicant has the education and experience to do the job.
- Second you can draw conclusions about the applicants previous growth and progress ,a trait especially important for management candidates.
- Third it’s tentative conclusions regarding the applicants stability based on previous work record.
- Fourth it may be able to use the data in the application to predict which candidates will succeed on the job and which will not.
- Employers should carefully review their application forms to ensure they comply with equal employment laws. Questions raising, race, religion, age, sex, or national origin are generally not illegal under federal laws ,but they are legal under certain state laws.
- Employers need to keep general practical guide lines in mind.” The employment history “ section should request detailed information on each prior employer ,including the name of the supervisor and his or her telephone no ,all essential for following up references.
- 4.5 Why careful selection is important?
- With a pool of applicants ,the next step is to select the best candidates for the job. Selecting the right employee is important for three main reasons.
- Your own performance always depends on your subordinates. Employees with the right skills and attributes will do a better job for you and the company. Employee without these skills will not perform effectively, and your own performance and firms will suffer. The time to screen out undesirables is before they care in the door ,not after.
- Its important because its costly to recruit and hire employees .Hiring and training even a clerk can spent lot of money. The total cost of hiring a manager could easily be ten times higher ,interviewing time reference clerk can lot of money. The total cost of hiring and training a manager could easily be ten times higher ,interviewing time reference clerking All these are cost involved.
- To avoid negligent hiring it is very important to know the applicants back ground .Some with criminal records taken in could cause and create problems with the customers .Egg: “Pontiacs Vs K. M. S. Investments “ an apartment manager with a pass key entered a woman’s apartment and assaulted a lady. The court found the companies negligent in not checking the managers back ground before hiring him.
- 4.6 Training and developing employees.
- Recruiting and selecting high potential employees does not guarantee ,they will perform effectively. For one thing people who don’t know what to do or how to do it can not perform effectively even if they want to. Next step is therefore to ensure that employees know what to do and how to do it.
- You have to orient and train them .Employee orientation provide new employees with the basic back ground information required to perform their jobs. Satisfactorily such as information about company rules .The HR specialist usually performs the first part of the orientation ,by explaining basic matters like working hours and vacation. The nature of the job ,introducing the passion to his or her new colleagues ,familiarization the new employees with the work place etc. New employees usually receive an employee hand book which explains things like working hours ,performance reviews ,getting on payroll and vacations. Furthermore orientation is not just about rules. It is also about making the new person feel welcome and at home and part of the team.
- 4.6.1 The training process.
- Training refers to the methods used to give new or present employees the skills they need to perform their jobs. Training is a hallmark of good management having high potential employees does not guarantee they will succeed. Instead they have to know ,what you want them to do and how you want them to do it.
- If they do the jobs their way, not the company ways . Good training is vital.
- 4.6.2 Why is training business is booming?
- ‘TRAINING “ is more inclusive than it used to be. Training used to focuses mostly on teaching technical skills ,such as training assemblers to solder wires or teachers to write lessons plan. Today such technical training is no longer enough. Employers today have to adapt to technological change, improve product and service quality and boost productivity to stay competitive .Doing so often requires remedial education .For example quality improvement programs require employees who can produce charts and graphs and analyze data. Similarly making ,communication as well as technological and computer skills .As competition demands better service employees increasingly require customer service training.
- 4.6.3 The five step training and development process.
- Training programs consists of five steps.
- The first step need analyzes step ,identifies the specific job performance skills needed .analyzes the skills and needs of the prospective trainees ,and develops ,specific measurable knowledge and performance objectives.
- instructional design ,you decide compile and produce the training programmed content ,including work books ,exercises and activities .Such as on the job training and assisted learning.
- The validation step in which the bugs are worked out of the training programs by presenting it to a small representative audience.
- To implement the programs by actually training target employee groups.
- An evaluation and follow up step in which management access the programs of service or failures.
- 4.6.4 On the job training.
- Every employee from mail clerk to companies president ,gets on the job training when he or she joins a company.
4.7 Employee motivation
- To retain good staff and to encourage them to give of their best while at work requires attention to the financial and psychological and even physiological rewards offered by the organization as a continuous exercise.
- Basic financial rewards and conditions of service (e.g. working hours per week) are determined externally (by national bargaining or government minimum wage legislation) in many occupations but as much as 50 per cent of the gross pay of manual workers is often the result of local negotiations and details (e.g. which particular hours shall be worked) of conditions of service are often more important than the basics. Hence there is scope for financial and other motivations to be used at local levels.
- As staffing needs will vary with the productivity of the workforce (and the industrial peace achieved) so good personnel policies are desirable. The latter can depend upon other factors (like environment, welfare, employee benefits, etc.) but unless the wage packet is accepted as ‘fair and just’ there will be no motivation.
- Hence while the technicalities of payment and other systems may be the concern of others, the outcome of them is a matter of great concern to human resource management.
- Increasingly the influence of behavioral science discoveries are becoming important not merely because of the widely-acknowledged limitations of money as a motivator, but because of the changing mix and nature of tasks (e.g. more service and professional jobs and far fewer unskilled and repetitive production jobs).
- The former demand better-educated, mobile and multi-skilled employees much more likely to be influenced by things like job satisfaction, involvement, participation, etc. than the economically dependent employees of yesteryear.
- Hence human resource management must act as a source of information about and a source of inspiration for the application of the findings of behavioral science. It may be a matter of drawing the attention of senior managers to what is being achieved elsewhere and the gradual education of middle managers to new points of view on job design, work organization and worker autonomy.
4.8 Employee evaluation
- An organization needs constantly to take stock of its workforce and to assess its performance in existing jobs for three reasons:
- To improve organizational performance via improving the performance of individual contributors (should be an automatic process in the case of good managers, but (about annually) two key questions should be posed:
- what has been done to improve the performance of a person last year?
- and what can be done to improve his or her performance in the year to come?).
- To identify potential, i.e. to recognize existing talent and to use that to fill vacancies higher in the organization or to transfer individuals into jobs where better use can be made of their abilities or developing skills.
- To provide an equitable method of linking payment to performance where there are no numerical criteria (often this salary performance review takes place about three months later and is kept quite separate from 1. and 2. but is based on the same assessment).
- To improve organizational performance via improving the performance of individual contributors (should be an automatic process in the case of good managers, but (about annually) two key questions should be posed:
- On-the-spot managers and supervisors, not HR staffs, carry out evaluations. The personnel role is usually that of:
- Advising top management of the principles and objectives of an evaluation system and designing it for particular organizations and environments.
- Developing systems appropriately in consultation with managers, supervisors and staff representatives. Securing the involvement and cooperation of appraisers and those to be appraised.
- Assistance in the setting of objective standards of evaluation / assessment, for example:
- Defining targets for achievement;
- Explaining how to quantify and agree objectives;
- Introducing self-assessment;
- Eliminating complexity and duplication.
- Publicizing the purposes of the exercise and explaining to staff how the system will be used.
- Organizing and establishing the necessary training of managers and supervisors who will carry out the actual evaluations/ appraisals. Not only training in principles and procedures but also in the human relations skills necessary. (Lack of confidence in their own ability to handle situations of poor performance is the main weakness of assessors.)
- Monitoring the scheme – ensuring it does not fall into disuse, following up on training/job exchange etc. recommendations, reminding managers of their responsibilities.
- Full-scale periodic reviews should be a standard feature of schemes since resistance to evaluation / appraisal schemes is common and the temptation to water down or render schemes ineffectual is ever present (managers resent the time taken if nothing else).
- Basically an evaluation / appraisal scheme is a formalization of what is done in a more casual manner anyway (e.g. if there is a vacancy, discussion about internal moves and internal attempts to put square pegs into ‘squarer holes’ are both the results of casual evaluation). Most managers approve merit payment and that too calls for evaluation. Made a standard routine task, it aids the development of talent, warns the inefficient or uncaring and can be an effective form of motivation.
4.9 Industrial relations
- Good industrial relations, while a recognizable and legitimate objective for an organization, are difficult to define since a good system of industrial relations involves complex relationships between:
- (a) Workers (and their informal and formal groups, i. e. trade union, organizations and their representatives);
- (b) Employers (and their managers and formal organizations like trade and professional associations);
- (c) The government and legislation and government agencies l and ‘independent’ agencies like the Advisory Conciliation and Arbitration Service.
- Oversimplified, work is a matter of managers giving instructions and workers following them – but (and even under slavery we recognize that different ‘managing’ produces very different results) the variety of ‘forms’ which have evolved to regulate the conduct of parties (i.e. laws, custom and practice, observances, agreements) makes the giving and receipt of instructions far from simple. Two types of ‘rule’ have evolved:
- ‘Substantive’, determining basic pay and conditions of service (what rewards workers should receive);
- ‘Procedural,’ determining how workers should be treated and methods and procedures.
- Determining these rules are many common sense matters like:
- Financial, policy and market constraints on the parties (e.g. some unions do not have the finance to support industrial action, some have policies not to strike, some employers are more vulnerable than others to industrial action, some will not make changes unless worker agreement is made first, and rewards always ultimately reflect what the market will bear);
- The technology of production (the effect of a strike in newspaper production is immediate -it may be months before becoming effective in shipbuilding);
- The distribution of power within the community – that tends to vary over time and with economic conditions workers (or unions) dominating in times of full employment and employers in times of recession.
- Broadly in the Western style economies the parties (workers and employers) are free to make their own agreements and rules. This is called ‘voluntarism’. But it does not mean there is total noninterference by the government. That is necessary to:
- Protect the weak (hence minimum wage);
- Outlaw discrimination (race or sex);
- Determine minimum standards of safety, health, hygiene and even important conditions of service;
- To try to prevent the abuse of power by either party.
HR managers responsibilities
- The personnel manager’s involvement in the system of industrial relations varies from organization to organization, but normally he or she is required to provide seven identifiable functions, thus:
- To keep abreast of industrial law (legislation and precedents) and to advise managers about their responsibilities e.g. to observe requirements in respect of employing disabled persons, not to discriminate, not to disclose ‘spent’ convictions of employees, to observe codes of practice etc. in relation to discipline and redundancy, and similarly to determine organizational policies (in conjunction with other managers) relevant to legal and moral requirements (see also 4.).
- To conduct (or assist in the conduct) of either local negotiations (within the plant) or similarly to act as the employer’s representative in national negotiations. This could be as a critic or advisor in respect of trade etc. association policies or as a member of a trade association negotiating team. Agreements could be in respect of substantive or procedural matters. Even if not directly involved the personnel manager will advise other managers and administrators of the outcome of negotiations.
- To ensure that agreements reached are interpreted so as to make sense to those who must operate them at the appropriate level within the organization (this can involve a lot of new learning at supervisory level and new pay procedures and new recording requirements in administration and even the teaching of new employment concepts – like stagger systems of work – at management level).
- To monitor the observance of agreements and to produce policies that ensure that agreements are followed within the organization. An example would be the policy to be followed on the appointment of a new but experienced recruit in relation to the offered salary where there is a choice of increments to be given for experience, ability or qualification.
- To correct the situations which go wrong. ‘Face’ is of some importance in most organizations and operating at a ‘remote’ staff level personnel managers can correct industrial relations errors made at local level without occasioning any loss of dignity (face) at the working level. ‘Human resource management’ and the obscurity of its reasoning can be blamed for matters which go wrong at plant level and for unwelcome changes, variations of comfortable ‘arrangements’ and practices and unpopular interpretation of agreements.
- To provide the impetus (and often devise the machinery) for the introduction of joint consultation and worker participation in decision-making in the organization. Formal agreement in respect of working conditions and behavior could never cover every situation likely to arise. Moreover the more demanding the task (in terms of the mental contribution by the worker to its completion) the more highly–educated the workers need to be and the more they will want to be consulted about and involved in the details of work life. Matters like the rules for a flextime system or for determining the correction of absenteeism and the contents of jobs are three examples of the sort of matters that may be solely decided by management in some organizations but a matter for joint consultation (not negotiation) in others with a more twenty-first-century outlook and philosophy. Human resource management is very involved in promoting and originating ideas in this field.
- To provide statistics and information about workforce numbers, costs, skills etc. as relevant to negotiations (i.e. the cost of pay rises or compromise proposals, effect on differentials and possible recruitment/retention consequences of this or whether agreement needs to be known instantly); to maintain personnel records of training, experience, achievements, qualifications, awards and possibly pension and other records; to produce data of interest to management in respect of personnel matters like absentee figures and costs, statistics of sickness absence, costs of welfare and other employee services, statements about development in policies by other organizations, ideas for innovations; to advise upon or operate directly, grievance, redundancy, disciplinary and other procedures.
- 4.10 Provision of employee services
- Attention to the mental and physical well-being of employees is normal in many organizations as a means of keeping good staff and attracting others.
- The forms this welfare can take are many and varied, from loans to the needy to counseling in respect of personal problems.
- Among the activities regarded as normal are:
- Schemes for occupational sick pay, extended sick leave and access to the firm’s medical adviser;
- Schemes for bereavement or other special leave;
- The rehabilitation of injured/unfit/ disabled employees and temporary or permanent move to lighter work;
- The maintenance of disablement statistics and registers (there are complicated legal requirements in respect of quotas of disabled workers and a need for ‘certificates’ where quota are not fulfilled and recruitment must take place);
- Provision of financial and other support for sports, social, hobbies, activities of many kinds which are work related;
- Provision of canteens and other catering facilities;
- Possibly assistance with financial and other aid to employees in difficulty (supervision, maybe, of an employee managed benevolent fund or scheme);
- Provision of information handbooks,
- Running of pre-retirement courses and similar fringe activities;
- Care for the welfare aspects of health and safety legislation and provision of first-aid training.
- The location of the health and safety function within the organization varies. Commonly a split of responsibilities exists under which ‘production’ or ‘engineering’ management cares for the provision of safe systems of work and safe places and machines etc., but HRM is responsible for administration, training and education in awareness and understanding of the law, and for the alerting of all levels to new requirements
- Above discussed development of human resources management was initiated from the west. Hence, it can be called as western strategy of human resources management.
- 5. Human Resources Management in East.
- Ten years ago, Human Resource Management was almost an unknown term in Asia. Training, selection, and performance appraisal were given very short shrift, and staff specialists, when they existed, were known as Personnel Managers, or had a dual role of Administration Manager with a “Personnel” tag thrown in for good measure. Back in those days, Asian companies were not aware of how effective management of the human resource had a major bearing on the bottom line. The educational sector gave little support. Professional associations were fledgling to say the least. A “personnel” position was often something in which you ended up in after failing to make sales and seen as a dead end position. The National University of Singapore, the government anointed showcase of an Asian university did not offer one unit in psychology. China funded anything to do with science and technology, but soft sciences such as management and HRM were ignored.
- Part of this was due of course to the culture of staffing of Asian business. Guanxi reigned supreme in staffing decisions, with family controlled companies meaning promotion was often the sole pre-rogative of family members. Cash reigned supreme as a way of evaluating jobs, where opportunities for professional development, training, and knowledge acquirement played very much the second fiddle to the salary level and perks. Objective rating of performance in many companies was therefore irrelevant, even if there was the competence to perform it well.
6. Comparison of West & East HRM models.
- 7. Human resources challenges in Sri Lanka.
- The recent Employers’ Federation seminar on “a more pragmatic approach to management rewards” highlighted the current state of play of executive compensation in the private sector and the need to move away from fixed pay towards short term and long-term incentives to drive superior performance and to retain top performers.
- Today the Indian sub continent is becoming an employee market, with job seekers having the power of choice. Candidates are increasingly selective and know their market value. It is a candidates’ market as more of them are turning job offers or negotiating salaries aggressively.
- Take Sri Lanka because of a short supply of good talent an open war for talent is being fought in our corporate corridors by companies to recruit the right candidates for their companies despite the number of CVs being received by them have increased drastically compared to five years ago. Good jobs are going begging and compensation skyrocketing due to the shortage of right people with the required financial sophistication. The brain drain too has added to this problem and made it difficult for companies to fill critical short-term talent gaps.
- The demand for vertical skills and companies looking for a closer fit is putting pressure on recruitment consultants to move the limited talent from one company to another at a much faster pace causing much anxiety to HR managers. Companies to prevent their business objectives languishing in the face of shortage of the right talent are willing to pay big bucks to prospective candidates; these companies have thus been involuntary contributors to a big increase in salary levels. In today’s context a talented employee can be as valuable and hard to replace as a loyal customer.
- Even more so in companies where value is created by knowledge and information. In fact Lee Kuan Yew argued some years ago that “trained talent is the yeast that transforms a society and makes it rise.” Brainpower as we all know is today the foundation of value creation, therefore injecting an endless stream of top talent into the veins of the business and building the best team in the industry would become the key to ensure that organizations excel in the new global market place, deliver constantly superior products and services and set standards that others can follow
- Companies now need to build talent at all levels, people who can make a huge difference in organizational performance and continuously find people who make a difference, Jim Collins in his book ‘Good to Great’ says “we’re not going to figure out where to drive this bus until we’ve figured out who should be on the bus, who should be off the bus, and who should be in what seats. Then we’ll turn our attention to where we’re going to drive the bus”. So the challenge for any company is to first get the right people on the bus, the wrong people off the bus, the right people into the right seats- then figure out where to drive the bus.
- The key talent in a business is the company’s most important asset and a source of competitive advantage–everything else can be replicated. Companies then need to build talent at all levels that can make a difference in organizational performance and continuously find people who make a difference.
- This is leading to more pressure on HR managers from the top to shift from being a personal administrator to being a strategic business partner in recruiting, motivating and retaining top talent. Then, it is time the human resources department–the traditional keeper of the people function-is considered the company’s most valuable strategic function.
- HR professionals should strongly position HR departments to take on the role of a strategic business partner, and ensure HR is viewed on equal terms with other business partners, such as finance or sales. Today there is ample evidence to support this argument. For example in researching what drives corporate value, the Forbes/Ernst & Young Value Creation Index found this to be one of the top key factors in a firm’s ability to attract and manage talented employees.
- So companies need to make sure they are getting the best people and have the competence to inspire and motivate employees to release their discretionary effort beyond the call of duty. In today’s context companies have to work very hard to find good talent because there is a short supply of good talent. So when they find the right talent with the right profile they would have to make sure that they are not only offering very competitive compensation package, but also the kind of culture, development and other benefits that makes the company the kind of company that people want to work for.
- Companies are fond of the maxim employees are our most important asset, yet beneath the rhetoric too many CEOs still regard – and –manage – employees as costs. This is dangerous because for many companies the people are the only source of long- term competitive advantage. Therefore companies that fail to invest in employees jeopardize their own success and survival. If the CEO is expected to build and motivate talent it calls upon competencies of character more than technical expertise among CEOs. It relies upon on higher order abilities to create unity and harmony, to instill trust, to create hope and optimism and to work from a base of shared values and interdependence.
- Leadership of this type is often indirect and behind the scene versus from the front and top down. Today motivating people is very different to what it was some years ago, because nowadays, oversees assignments, stock options, casual dress and free gyms are just as important to attracting and retaining talented employees as salaries, job security and careers once were. A happy workforce can reward a company through better profits, better productivity and lower staff turnover. Also there is no special magic in being a good employer.
- It does not necessarily take money, size, or market to become an employer of choice. Rather, its enlightened HR policy and leadership that is committed to its staff. It is organizational capabilities that create products and services that result in a customer taking money out of their wallets and putting it into ours instead of giving it to their competitors.
- Churchill many years ago observed that ‘the empires of the future will be empires of the mind.” In many of the developed world our immigrants tend to get criticized unfairly by the press. Many top economies of the world would be lost without our qualified professionals, and many governments would still be very happy to attract our best talent. The most mobile people are not our political refugees, but the educated, and they are being sought after as never before.
- Most governments are easing restrictions on the entry of qualified people. One of the best programmers for drawing in good human capital was initiated in the ‘80s by the Singapore government. The initiative helped Singapore to attract some of our best brains and even today continues to go out of its way to attract and import foreign talent. For a start the government should focus on wooing our professionals working abroad by making it very attractive for them to come back. But the government’s effort will all depend on whether the country is backed up by a vibrant economy and also managed professionally.
- A combination of sensible government policies and economic liberalization could work wonders for us. Our best bet would therefore be to woo back some of our top expatriates who have gone abroad to make their money but still feel the tug of their home country. We need to introduce attractive incentives that can entice them to return and also to retain our existing talent. However, despite the incentives they will not return until and unless we improve our governance record and manage the economy professionally. In addition to this the government should initiate a programme in consultation with the private sector to equip our university graduates with the required skills set.
- Globalization has left only one true path to profitability for firms operating in high wage markets, to base their competitive strategy on exceptional human resource management. Any benefits that historically have been associated with superior technology and access to capital are now too fleeting to provide sustainable advantage.
- As this former source of advantage become less relevant, managing human resources by instinct and intuition becomes not only inadequate but also dangerous. The most successful countries in the future will be those that manage their people like the assets they are.
- In the future the global demand for talent is only likely to intensify further, we are already struggling to find enough good quality engineers, technicians, doctors, HR, marketing and even English teachers. The talent shortage may seem like a crisis to many of us, but like any crisis it’s also an opportunity. So for a change the government and the private sector need to be more imaginative about attracting, developing and retaining our best talent in Sri Lanka and abroad.
- 8. CONCLUTION.
- Globally what HRM has done for the management of “people “ are immense and huge. Adequate evidence are there to say about how history “Managed people for the best out put”. Some of the “seven wonders “are the excellent results of how well HRM has been practiced at the past. How well “JUST IN TIME” has been practiced is very well seen.
- “Human power and the strength “ is the most valuable assets that should be managed very well. Unfortunately in Sri Lanka HR is practiced only in few sectors like cooperate and private only. Sri Lanka history has lot of evidence to say how well human power was managed for the best of outcome. Eg: How old kings created those wonders like “Ruwanwelisaya ,Mirisawatiya , and all those enormous water tanks etc which use in eastern philosophies of people management .We still can argue to say that HR was practiced in the world to the best , in the history, when compared todays.
- Very unfortunately that HRM knowledge is not passed down to the generation and it has come to a natural death .If these strategies can be traced back and reintroduced along with the present western type of HRM strategies it is obvious that SRI LANKA will be a one of the best developed countries in the world having the best of “HRM’ practices.
- 9. References
- Gary Deller – Human Resource Management _ 9th Edition , pp 55 ~ 131
- Sunday Times – Human resources challenges for Sri Lanka – 22nd April 2007.
- Gary Deshler, [Human Resource Management.]www.prenhall.com/dessler.