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The functions are a mixture of behavior analysis, policy formulations and maintenance of good interpersonal relations. These include:

  • Conducting job analyses (determining the nature of each employee’s job) Planning labor needs and recruiting job candidates
  • Selecting job candidates
  • Orienting and training new employees
  • Managing Wages and Salaries (how to compensate employees) Providing incentives and benefits
  • Appraising performance and Communicating (interviewing, counselling, disciplining)
  • Training and developing
  • Building employee commitment
  • Equal opportunity and affirmative action
  • Employee health and safety
  • Grievances and labor relations

The Functions of HRM can be broadly classified into two categories

  1. Managerial Functions
  2. Operative Functions

Managerial Functions : HR Manager performs the functions of planning, organizing, directing and controlling.

  1. Planning : Planning  like all planning is forward looking or future oriented. It involves planning of Human resources, requirements, recruitment, selection, training etc. It involves the forecasting of manpower need, changing values, attitudes and behavior  of employees and their impact on organization.
  2. Organising : It is a process of achieving a goal by organizing  people and other resources. It established a relationship among the employees to attain a companies goal.
  3. Directing : It is a very important function in the management of any enterprise. It helps the managers in ensuring quality performance of jobs by the employees and achievement of organisational goals. It involves supervision, communication and providing leadership to the subordinates and motivating them to contribute to their best of capability. In this lesson we shall learn about this function in detail.
  4. Coordinating : Management seeks to achieve co-ordination through its basic functions of planning, organizing, staffing, directing and controlling. That is why, co-ordination is not a separate function of management because achieving of harmony between individuals efforts towards achievement of group goals is a key to success of management. Co-ordination is the essence of management and is implicit and inherent in all functions of management.
  5. Controlling : Controlling consists of verifying whether everything occurs in confirmities with the plans adopted, instructions issued and principles established. Controlling ensures that there is effective and efficient utilization of organizational resources so as to achieve the planned goals. Controlling measures the deviation of actual performance from the standard performance, discovers the causes of such deviations and helps in taking corrective actions.

Operative Functions :

The operative functions of personnel management are related to specific activities of personnel management viz, employment, development, compensation and relations. All these functions are interacted by managerial functions. Further these functions are to be performed in conjunction with management functions.

1. Employment

Employment is concerned with securing and employing the people possessing required kind and level of human resources necessary to achieve the organizational objectives. It covers the functions such as job analysis, human resources planning, recruitment, selection, placement, induction and internal mobility.

Job Analysis: It is the process of study and collection of information relating to the operations and responsibilities of a specific job. It includes:

1. Collection of data, information, facts and ideas relating to various aspects of jobs including men, machines and materials.

2. Preparation of job description, job specification, job requirements and employee specification which help in identifying the nature, levels and quantum of human resources.

3. Providing the guides, plans and basis for job design and for all operative functions of HRM.

Human Resources Planning:

It is a process for determination and assuring that the organization will have an adequate number of qualified persons, available at proper times, performing jobs which would meet the needs of the organization and which would provide satisfaction for the individuals involved. It involves

  • Estimation of present and future requirement and supply of human resources basing on objectives and long range plans of the organization.
  • Calculation of net human resources requirement based on present inventory of human resources.
  • Taking steps to mould, change, and develop the strength of existing employees in the organization so as to meet the future human resources requirements.
  • Preparation of action programs to get the rest of human resources from outside the organization and to develop the human resources of existing employees.


It is the process of searching for prospective employees and stimulating them to apply for jobs in an organization. It deals with:

(a) Identification of existing sources of applicants and developing them.

(b) Creation / Identification of new sources of applicants.

(c) Stimulating the candidates to apply for jobs in the organization.

(d) Striking a balance between internal and external sources.


It is the process of ascertaining the qualifications, experience, skill, knowledge etc., of an applicant with a view to appraising his / her suitability to a job appraising.

This function includes:

(a) Framing and developing application blanks.
(b) Creating and developing valid and reliable testing techniques.
(c) Formulating interviewing techniques.
(d) Checking of references.
(e) Setting up medical examination policy and procedure.
(f) Line managerial decision.
(g) Sending letters of appointment and rejection.
(h) Employing the selected candidates who report for duty.

Placement: It is the process of assigning the selected candidate with the most suitable job in terms of job requirements. It is matching of employees specifications with job requirements. This function includes:

(a) Counseling the functional managers regarding placement.

(b) Conducting follow-up study, appraising employee performance in order to determine employees adjustment with the job.

(c) Correcting misplacements, if any.

Induction and Orientation: Induction and orientation are the techniques by which a new employee is rehabilitated in the changed surroundings and introduced to the practices, policies, purposes and people etc., of the organization.

(a) Acquaint the employee with the company philosophy, objectives, policies, career planning and development, opportunities, product, market share, social and community standing, company history, culture etc.

(b) Introduce the employee to the people with whom he has to work such as peers, supervisors and subordinates.

(c) Mould the employee attitude by orienting him to the new working and social environment.

2. Human Resource Development :

Human resource development  refers to the process whereby the employees are continuously helped in a planed way to

  • Acquire or sharpen capabilities required to perform various tasks associated with  their present /future expected roles.
  • Develop their general  capabilities as individuals so that they are able to discover and exploit their own inner potential for their own and/or organizational development purpose.
  • Develop an organizational work culture where superior subordinate relationships, team work and collaboration among different units are strong and contribute to the professional well – being , motivation and pride.

This Function includes :

Performance Appraisal : It is the systematic evaluation of individuals with respect to their performance on the job and their potential for development . It Includes :

  • Developing policies, procedures and techniques
  • Helping the functional managers
  • Reviewing of reports and consolidation of reports
  • Evaluating the effectiveness of various programs

Training : It is the process of imparting the employees the technical and operating skills and knowledge . It includes

  • Identification of training needs of the individuals and the company
  • Developing suitable training programs
  • Helping and advising line management in the conduct of training programs
  • Imparting of requisite job skills and knowledge to employees.
  • Evaluating the effectiveness of training programs.

Management Development : It is the process of designing and conducting suitable executive developments programs so as to develop the managerial  and human relation skill of employees. It Includes :

  • Identification of the areas in which management development is needed.
  • Conducting development programs
  • Motivating the executives
  • Designing special development program for promotions
  • Using the service of specialists, and /or utilizing of the institutional executive development programs.
  • Evaluating  the effectiveness of executives of executive development programs.

Career Planning and Development : It is the planning of one’s career and implementation of career plans by means of education, training  job search and acquisition of work experience. It includes internal and external mobility.

a) Internal Mobility: It includes vertical and horizontal movement of an employee within an organization. It consists of transfer, promotion and demotion.

Transfer: It is the process of placing employees in the same level jobs where they can be utilized more effectively in consistence with their potentialities and needs of the employees and the organization. It also deals with:

  • Developing transfer policies and*procedures.
  • Guiding employees and line management on transfer.                                         ,
  • Evaluating the execution of transfer policies and procedures.

Promotion: It deals with upward reassignment given to an employee in the organization to occupy higher position which commands better status and/or pay keeping in view the human resources of the employees and the job requirements.

  • This function covers the formulating of equitable, fair and consistent promotion policies and procedures.
  • Advising line management and employees on matters relating to promotion.
  • Evaluating the execution of promotion policies and procedures.

Demotion: It deals with downward reassignment to an employee in the organization.

  •  Develop equitable, fair and consistent demotion policies and procedure.
  • Advising line managers on matters relating to demotions.
  • Oversee the implementations of demotion policies and procedures.

b)  External Mobility: External mobility is of two types, viz., accessions and separations.

Accessions: Accessions are additions of new candidates to the existing employees. Accessions include employment of new candidates, re-employment of former employees, employees called back to work after lay-off, etc.

Separations: Separations mean termination of employment. They are also called employee turnover. They include:

  • Voluntary Quit: Voluntary quit or resignations by employees when they arc dissatisfied with the present job and/or organization, or when they get better employment in other organizations.
  • Lay-off or Lack of Work: Organizations terminate the services of employees when the jobs are eliminated or reduced due to adoption to technology or adverse business conditions or lack of power, materials, breakdown of machinery, etc.
  • Disciplinary Lay-off or Discharge: Organizations terminate the services of employees if they are dissatisfied with the performance or conduct of employees.
  • Retirement, and
  • Deaths: Stages in External Mobility: There are four stages in external mobility, viz.: Exploration, Establishment including mutual recruitment, acceptance to the recruitment conditions, entry, having first job assignment settlement, transfer, promotion and granting of tenure. Maintenance stage, and Decline stage.

Organization Development: It is a planned process designed to improve organization effectiveness and health through modifications in individual and group behavior, culture and systems of the organization using knowledge and technology of applied behavioral science.

3) Compensation: It is process of providing adequate, equitable and fair remuneration to the employees. It includes job evaluation, wage and salary administration, incentives, bonus, fringe benefits, social security measures, etc.

Job Evaluation: It is the process of determining relative worth of jobs;

a)      Select suitable job evaluation techniques.

b)      Classify jobs into various categories.

c)      Determining relative value of jobs in various categories.

Wage and Salary Administration: This is the process of developing and operating a suitable wage salary program. It covers:

a)      Conducting wage and salary survey.

b)      Determining wage and salary .rates based on various factors.

c)      Administering wage and salary programs.

d)     Evaluating its effectiveness.

Incentives: It is the process of formulating, administering and reviewing the schemes of fir incentives in addition to regular payment of wages and salary. It includes:

a)      Formulating incentive payment schemes.

b)     Helping functional managers on the operation.

c)      Review them periodically to evaluate effectiveness.

Bonus: It includes payment of statutory bonus according to the Payment of Bonus Act, 1956 and its latest amendments.

Fringe Benefits: These are the various benefits at the fringe of the wage Management provides these benefits to motivate the employees and to meet their life’s contingencies. These benefits include:

a)      Disablement benefit.

b)      Housing facilities

c)      Educational facilities to employees and children.

d)     Canteen facilities. Recreational facilities.

e)      Conveyance facilities.

f)       Credit facilities.

g)      Legal clinic.

h)  Medical, maternity and welfare facilities. i)   Company stores.

Social Security Measures: Managements provide social security to their employees in addition to the fringe benefits. These measures include:

  • Workmen’s compensation to those workers (or there dependents) who involve in accidents.
  • Maternity benefits to women employees.
  • Sickness benefits and medical benefits.
  • Disablement benefits/allowance.
  • Dependent benefits.
  • Retirement benefits like provident fund, pension, gratuity etc.

Human Relations: It is the process of interaction among human being. Human relations is an area of management in integrating people into work situation in a way that motivates them to work together productively, co-operatively and with economic, psychological and social satisfaction. It includes:

  • Understanding and applying the models of perception, personality, learning, intra and inter personal relations, intra and inter group relations,
  • Motivating the employees,
  • Boosting employee morale,
  • Developing the communication skills,
  • Developing the leadership skills.
  • Redressing employee grievances properly and in time by means of a well formulated grievance procedure.
  • Handing disciplinary case by means of an established disciplinary procedure,
  • Counseling the employees in solving their personal, family and work problems and releasing-their stress, strain and tensions
  • Improving quality of work life of employees through participation and other means.
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