Human Resource Managment                                                             HM 204                                                               
                                                     UNIT 1:  
                           DEFINITION OF HRM, ROLE, 
                 IMPORTANCE AND CHALLENGES OF 
                                                        HRM 
             Structure  
             1.1 Introduction 
             1.2 Objectives 
             1.3 Human Resource Management: concept 
                    1.3.1. People who manage 
                    1.3.2. People at work 
                    1.3.3. Definitions of Human Resource Management 
                    1.3.4. Management of Men is a challenging job 
                    1.3.5. Features of Human Resource Management 
             1.4 Role of Human Resource Management 
             1.5 Importance of Human Resource Management 
             1.6 Challenges of Human Resource Management 
             1.7 Summary 
             1.8 Glossary 
             1.9 Answer to check your progress/Possible Answers to SAQ 
             1.10 References/Bibliography 
             1.11 Terminal Questions 
              
             1.1  INTRODUCTION  
             As one author has rightly said 1+1 makes an organization, i.e., where there are two or 
             more  persons  there  is  in  effect  and  organization.  Some  individuals  prefer  to  work 
             independently in isolated circumstances. But the vast majority of all work in today‘s 
             environment takes place within the context of a structured organization- a grouping of 
             individuals into a unified and common effort. To look after the various functions set for 
             the  organization  adequate  resources  in  men  and  materials  have  to  be  arranged  by 
             individuals  who  serve  as  managers  or  supervisors  within  organizations.  Thus  there 
             emerged the term ‗Human Resource Management‘. 
              
             1.2  OBJECTIVE 
             After reading this unit, you will be able to understand: 
                     Concept of HRM 
                     The role and importance of HRM 
                     The challenges of HRM 
                       
             1.3  CONCEPT OF HUMAN RESOURCE MANAGEMENT 
             Of all the factors of production namely M‘s of Management i.e Materials, Machinery, 
             money,  methods  and  Men,  Man  occupies  an  important  place.  The  other  4  M‘s  by 
             themselves will not help the organization to achieve its goals unless there is an effective 
             coordination and utilization of human resources. Rensis Libert says, all the activities of 
             Uttarakhand Open University                                                                      1 
                Human Resource Managment                                                             HM 204                                                               
                any enterprise are initiated and determined by the persons who make up the institution, 
                plant or office and all else that make a modern form are unproductive except for human 
                effort and direction of all the tasks of the management. 
                 
                In the past, people migrated from villages to towns seeking employment. They found 
                themselves in totally different and new situations to which they were not used to. So 
                whenever they feel frustrated, they return to their villages and this resulted in loss of 
                trained labour. These people had no proper leader to guide them and even no proper 
                masters to manage them. The necessity of proper personnel management was then felt. It 
                was realized that a good personnel management will go a long way in making efficient 
                the overall management of the organization. 
                 
                The importance of human factor in any type of co-operative endeavor cannot be over 
                emphasized.  It  is  a  matter  of  common  knowledge  that  every  business  organization 
                depends for its effective functioning not so much on its material or financial resources as 
                on  its  pool  of  able  and  willing  human  resources.  The  over  whelming  importance  of 
                human factor is due to its unique characteristics. This is only resource which is able to 
                produce  an  output  greater  than  its  input.  Man  alone  can  produce  through  motivated 
                creativity- an output greater than the sum of his inputs. No other resource can do this. 
                Human resource appreciates in value with the passage of time. As time passes people 
                become  experienced  and  skilled.it  is  not  so  with  other  resources  which  generally 
                depreciate as time goes on.  
                 
                Human resource is most complex and unpredictable in its behavior. There is no cook 
                book formula of guide a manager how to motivate his workers. A manager can buy his 
                worker‘s time, he can buy his physical presence at a given place, he can buy a measured 
                number  of  skilled  muscular  motions  per  hour  or  day,  but  he  cannot  buy  worker‘s 
                enthusiasm, he cannot buy his initiative, he cannot buy his loyalty, he cannot buy his 
                devotion. Each individual has his own distinct background. This makes each individual 
                unique in his psychological frameworks. Hence they cannot be interchanged, much less 
                standardized. This implies that all individuals in an organization cannot be treated alike. 
                In  employing and supervising people and in endeavoring to reach their motivation, a 
                manager must follow tailor- made approach based on his understanding of the actions, 
                attitudes,  needs  and  urges  of  the  worker  concerned.  This  is  a  very  formidable  and 
                challenging task. 
                 
                1.3.1  PEOPLE WHO MANAGE 
                To look after the various functions set for the organization adequate resources in men and 
                materials have to be arranged by individuals who serve as managers or supervisors within 
                organizations. Such people have to make things happen to aid in the achievement of the 
                organizational objectives, to co-ordinate the resources of the organization- 4 important 
                Ms. Viz., money, material (raw or semi-manufactured), machinery (or fixed assets and 
                plants), and men (or human resources). It is an effective combination and dovetailing of 
                these factors on which the success or failure of the organization depends. The resources 
                by themselves will not help the organization to accomplish the objective, unless there is 
                an effective co-ordination and utilization of these human and non-human resources. 
                While the human resources available to management in an organization are only one part 
                of resources which must be co-ordinated, it is through the combined efforts of the people 
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     Human Resource Managment                                                             HM 204                                                               
     that monetary and material resources are utilized for organizational objectives. Without 
     human efforts, organizations cannot accomplish their objectives. Rensis Likert rightly 
     observes, ―All the activities of any enterprise are initiated and determined by the persons 
     who make up that institution, plants, offices, computers, automated equipment, and all 
     else that make a modern firm uses are unproductive except for human effort and direction 
     of all the tasks of management, managing the human component is the central and most 
     important task, because all else depends on how well it is done.‖ 
      
     Consequently, the managers have a central responsibility not only for the behavior and 
     performance of other people but also of their own behavior. Managers are appointed at 
     various levels to organize and co-ordinate the activities of the team members or fellow 
     work associated. This constitutes a hierarchy of management, where individuals perform 
     different roles: some are at the top level management; others are at the intermediate and 
     lower levels  of  the  management  group.  Those  at  the  lower  levels  are  responsible  to 
     persons at a higher organizational level. The greater the commitment of the members to 
     organizational  objectives,  the  greater  is  the  degree  of  effectiveness  with  which  the 
     organization works. 
      
     1.3.2. PEOPLE AT WORK 
     The principal component of an organization is its ‗human resources‘ of ‗people at work‘. 
     Human resources have been defined as ―from the national point of view, the knowledge 
     skills, creative abilities, talents and aptitudes obtained in the population; whereas from 
     the viewpoint of the individual enterprise, they represent the total of the inherent abilities, 
     acquired  knowledge  and  skills  as  exemplified  in  the  talents  and  aptitudes  of  its 
     employees.‖  Jucius  calls  these  resources,  ‗human  factors‘,  which  refer  to  ―a  whole 
     consisting of inter-related, inter-dependent and inter-acting physiological, psychological, 
     sociological and ethical components.‖ 
      
     It  is  the  human  resource  which  is  of  paramount  importance  in  the  success  of  any 
     organization, because most of the problems in organizational settings are human and 
     social rather than physical, technical or economic. Failure to reorganize this fact causes 
     immense loss to the nation, enterprise and the individual. In the words of Oliver Sheldon, 
     ―No industry can be rendered efficient so long as the basic fact remains unrecognized that 
     it is principally human. It is not a mass of machines and technical processes, but a body 
     of men. It is not a complex of matter, but a complex of humanity. It fulfills its function 
     not by virtue of some interpersonal force, but a human energy. Its body is not an intricate 
     maze of mechanical devices but a magnified nervous system.‖ 
      
     ‗People at work‘ comprise a large number of individuals of different sex, age, socio-
     religious group and different educational or literacy standards. These individuals in the 
     work place exhibit not only similar behavior patterns and characteristics to a certain 
     degree, but they also show much dissimilarity. Each individual who works has his own 
     set of needs, drives, goals, and experiences. Each has his own physical and psychological 
     traits. Each human being is not only a product of his biological inheritance but also a 
     result  of  interactions  with  his  environment.  Family  relationships,  religious  influences, 
     racial or caste backgrounds, educational accomplishment, the application of technological 
     innovations, and many other environmental influences affect the individual as he works. 
     Among the environmental factors that influence work behavior are various organizational 
     Uttarakhand Open University                                                                      3 
                                                 Human Resource Managment                                                             HM 204                                                               
                                                 elements (authority  relationships,  organizational  goals,  procedures,  rules  and  policies: 
                                                 informal  group  relationship,  the  type  and  manner  of  supervision  received  by  the 
                                                 employee, etc.). People come to work with certain specific motives to earn money, to get 
                                                 employment, to have better prospect in future, to be treated as a human being while at the 
                                                 place of work. They sell their labour for reasonable wage/ salary and other benefits. It is 
                                                 these  people  who  provide  the  knowledge  and  much  of  the  energy  through  which 
                                                 organizational objectives are accomplished. 
                                                  
                                                 The  management  must,  therefore,  be  aware  not  only  of  the  organizational  but  also 
                                                 employee needs. None of these can be ignored. The achievements for the organizations, 
                                                 the ‗people at work‘, ‗the people who manage them‘ (i.e., managers themselves), and 
                                                 other groups of the public (such as the consumers, shareholders, the entrepreneurs, the 
                                                 governments, the suppliers, etc.) are possible through a concerted effort. The employee 
                                                 develops four dimensional relationships: (i) those between management and workers; (ii) 
                                                 those among the workers themselves; (iii) those among the managerial personnel; and 
                                                 (iv)  those  among different members of the organization and the community. In other 
                                                 words,  he  develops ―human relations‖ the purpose of which is not to enable him to 
                                                 discover  clever  techniques  for  winning  friends  and  influencing  people  through 
                                                 personality  development; nor to enable him to manipulate people as though they are 
                                                 puppets, but to assist him in working more effectively with other people in organization.‖  
                                                  
                                                 1.3.3. DEFINITIONS OF HUMAN RESOURCE MANAGEMENT 
                                                  
                                                 Different  authors  have  given  different  definitions  of  the  term  ―Human  Resource 
                                                 Management‖.  Some of these are reproduced below: 
                                                  
                                                 ―The personnel function is concerned with the procurement, development, compensation, 
                                                 integration  and  maintenance  of  the  personnel  of  an  organization  for  the  purpose  of 
                                                 contributing  toward  the  accomplishment  of  that  organization‘s  major  goals  or 
                                                 objectives.‖ 
                                                                                                                                       -        Edwin B. Flippo 
                                                 ―Personnel administration is a method of developing the potentialities of employees so 
                                                 that  they  get  maximum satisfaction out of the work and give their best effort to the 
                                                 organization.‖ 
                                                                                                                                                 -Pigors and Myres 
                                                 ―Personnel Management is the specialized intelligent handling of the human factor by a 
                                                 separate  department  which  could  devote  its  full  time  for  research  along  the  line  of 
                                                 improvement in industrial relations.‖ 
                                                                                                                                       -         R.G.Gokhale 
                                                 ― Personnel  administration  is  the  art  of  acquiring,  developing  and  maintaining  a 
                                                 component work force in such a  manner  as to  accomplish  maximum  efficiency  and 
                                                 economy in the functions and objectives of the organization.‖ 
                                                                                                    -American Society for Personnel Administration 
                                                  
                                                 ―Personnel  Management  is  the  part  of  the  management  function  which  is  primarily 
                                                 concerned  with  human  relationships  within  an  organization.  Its  objective  is  the 
                                                 maintenance of those relationships on a basis which, by considering of the well-being of 
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