Components of HRM1HRM has emerged as a major function in organisations. Its origin can be traced back to Taylore and McGregor age. Today employee’s position in the organisations has changed. Managing human resources is one of the key elements in the co-ordination and management of work organisations. HRM is carried out in an organisation with the help of number of components it has. The following are the major components of HRM (Sarma, 1998) 


Human resource organisation is concerned with achieving success by organisation design and development, motivation, the application of effective leadership, and the process of getting across the message about what the enterprise is setting out to do and how it proposes to do it. The fundamental objective of human resource organisation is to ensure that every aspect of the organisation, employment, motivation, and management of people is integrated with the strategic objectives of the business and contribute to the successful achievement of those objectives. The human resource organisation programme has to take account of cultural issues so that the desired corporate culture can be developed or reinforced. Moreover, organisational development programmes and interventions are needed to achieve better integration, improve teamwork, motivate human resource, develop proper leadership, facilitate communication system, manage conflict and change, and obtain commitment. 


Human resource planning sets out to define how many people the organisation wants; the type of people the organisation needs at present and in the future, in terms of their expertise; and how they “fit” the corporate culture. It involves the forecasting of both the supply and demand for future labour. It provides the base for recruitment programmes and for human resource development plans.


Human resource systems are the essential programmes needed to recruit, appraise, pay and look after the health, safety and well-being of the employees in the organisation. The main key programmes are:

  1. Recruitment management: It is a process of obtaining the required human resource for an organisation.
  2. Information Management: It is a method of ensuring that all policies and practices are to be well articulated and effectively communicated to the workforce.
  3. Training Management: It is a system of identification of training needs, preparation of a training strategy, and an appropriate training system.
  4. Performance Management: It is a technique of appraising performance systematically against defined criteria, reviewing progress to date and assessing the potential for advancement. There are three main appraisal systems such as performance appraisal, potential appraisal, and performance coaching or counselling.
  5. Reward Management: It is a method to ensure that people are rewarded in accordance with their contribution.
  6. Career Management: It is a system of charting special career paths for the individual employees for advancement in the organisation.
  7. Health and Safety Management: It is a system of maintaining a healthy and safe system of work in an organisation. (h) Discipline management: It is a system of administering discipline to foster positive employee behaviour that will promote organisational objectives.
  8. Culture management: It is a system of thinking and behaving shaped by the values, attitudes, rituals and sanctions in an organisation. 


Lippit (1978) points out that HRD as a system depends on: (a) the work itself which generates a higher degree of responsibility for the employees; (b) the individual’s personal and professional growth; (c) the improved quality output as a result of increased responsibility; and (d) the organisation as an open system. Focus on all these aspects is what HRD all about.

Rao (1985) defines HRD as “a process by which the employees of an organisation are helped, in a continuous planned way to: (a) acquire or sharpen capabilities required to perform various tasks and functions associated with their present or expected future roles; (b) develop their general enabling capabilities as individuals so that they are able to discover and exploit their own inner potentials for their own and/or organisational development purposes; and (c) develop an organisational culture where superior-subordinate relationship, team-work, and collaboration among different subunits are strong and contribute to the organisational health, dynamism and pride of employees.”

HRD is a series of organised activities conducted within a specified time and designed to produce behavioural change. It is rooted in the belief that human beings have the potential to do better. It has two main purposes: (a) to provide employees with a greater opportunity to grow and succeed within a company; and (b) to strengthen management and professional teams at all organisational levels. Furthermore, it aims at developing employee capabilities in line with their career interests and with the manpower needs of the company.

HRD as a function consists of various activities related to training, education and development, and performance appraisal. All aspects of training and appraisal play a significant role in achieving the individual’s growth and development. In this respect HRD is more a proactive and supportive function wherein the organisation has to take a lead in helping the people to grow and realise their potential role.

Human resource development programmes help to ensure that the organisation has the people with the skills and knowledge it needs to achieve its strategic objectives. They aim to train new employees to the level of performance required in their jobs quickly and economically and to develop the abilities of existing staff so that performance in their present jobs are improved and they are prepared to take on increased responsibilities in the future.

The thrust of human resource development is on training and development. It is a dynamic process which aims at improving the skills and talents of the personnel. Training fills the gap between what someone can do and what he should be able to do. Its first aim is to ensure that, as quickly as possible, people can reach an acceptable level in their jobs. Training then builds on this foundation by enhancing skills and knowledge as required to improve performance in the present job or to develop the potential for the future.

Development can be defined as the modification of behaviour through experience. It provides for people to do better in the existing jobs and prepares them for greater responsibility in the future. It builds on strengths and helps to overcome weaknesses, and ensures that the organisation has the expertise it needs. Development operates at all levels – shop floor level, middle management level, and top management level -covering executives and non-executives.

HRD is an important force for the future. The challenges to HRD will continue. Instead of doers, HRD practitioners will be the process designers, researchers, strategists, advisors, business managers, and consultants. Looking ahead to the 21st century, it is clear that the HRD community must accelerate the trends that have just begun. They must: (a) ensure that all people practice and support continuous development, learning and high performance; (b) work to create participative cultures and to dissolve autocratic and dependent mindsets; (c) help prepare people and institutions to succeed in a rapidly changing global village; (d) treat their employees like customers for enduring success of the organisation.


Human resource relationships deal with the handling of employees individually and collectively as members of trade unions or staff associations. Their main aim is to increase co-operation and trust and to involve employees actively in the company’s affairs. It also deals with problem-solving techniques, particularly to solve problems relating to disciplinary cases and grievances. There are two sides to a dispute in most organisations: the management and the workers. There is a gap and the means have to be found to bridge that gap. Whether or not unions exist, it is highly desirable for the management to develop methods of dealing with employees collectively. Nonetheless, relationships with unions often involve confrontations. The necessary techniques must be evolved for encouraging mutuality and working together in the interests of all.

Unions have to be managed like everything else in an organisation. Management normally gets the union it deserves. If it handles unions the wrong way, the results for the organisation can be disastrous. An approach to collective dealing should be:(a) the recognition of the union, (b) the respective role performance of management and union, (c) the type of procedures one can adopt to regularize relationships with unions, (d) the basic techniques of negotiating with unions, (e) the mechanism of involvement through participation, both traditional forms of joint consultation as well as the Japanese import of quality circles.


According to Peters and Watennan, to achieve productivity through people, it is very essential to “treat them as adults, treat them as partners, treat them with dignity, and treat them with respect.” These fundamental human relations values provide the base for productivity management programmes, which use techniques such as method study to improve efficiency. Both managers and workers must be persuaded somehow to realise that they have a common interest in increasing output.

The following actions are required to improve the use of human resources: (a) conduct a productivity drive; (b) improve manpower budgeting and control techniques; (c) introduce work measurement; (d) use appropriate payment method by results; bonus and profit-sharing schemes; (e) improve motivation; (f) involve employees in improvement programmes; (g) introduce new technology; (h) negotiate appropriate productivity agreements; and (i) introduce training programmes based on an analysis of productivity needs. 


HRA means accounting for people as the organisational resource. It is the measurement of the cost and value of people to organisations and involves measuring the costs incurred on recruiting, selecting, hiring, training and developing employees and judging their economic value to the organisation. HRA can be very useful in managerial decision-making. For instance, whether it is recruitment and selection or replacement of an employee, HRA can provide an estimate of the cost involved in the process. Similarly, it can help the management in budgeting for development of human resources. HRA can also provide data pertaining to turnover costs, the cost of employee’s absence and its impact on performance of others.


The purpose of a human resource audit is to assess the effectiveness of the human resource function and to ensure regulatory compliance. Human resource audit is a vast subject and covers many delicate aspects of human and organisational interactions.

The HRD auditor has to study the organisation design, its objective, performance of its human resources, as well as the proper maintenance of HRD climate and practices. The job of the HR auditor is not an easy one. To gain success, he has to be very selective about the area and procedure he wishes to follow. Auditing in the field of human resources is a difficult job, more so because unlike other audits, the auditor has to deal with individuals vis-a-vis organisational priorities. Therefore, the HR auditor is required to be very systematic in his job and define the task clearly as to which arena he has to cover.

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