26428518 Nature and Development of Personnel Management

8/9/2019 26428518 Nature and Development of Personnel Management

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Lecture 2

Date:

Topics Discussed: Nature and Development of Personnel Management.

Instructor:Mr. Parikshit Joshi

EVOLUTIONOF HRM

Earlier References: InWestern countries HRM had its primitive beginning in 1930s. Not

much thought was given on this subject in particular and no written records or

documents existed on this subject even as a philosophy in Western ancient literature.However, it is quite interesting to note HRM concepts were available, in ancient

philosophies of Greek, Indian and Chinese. This is not to suggest that industrial

establishment and factories system, as it is known today, existed in ancient Greece, Indiaor China. The philosophy of managing human being, as a concept was found developed in

ancient literatures in general and in Indian philosophy in particular. Some references are

given in Table 1.

Table 1

Personnel Functions: Till 1930s, it was not felt necessary to have a separate discipline ofmanagement called "Personnel Management". In fact, this job was assigned as part of

the factory manager. Adam Smith's concept of factory was that it consists of three

resources, land, labour and capital. This factory manager is expected to "procure,process and peddle (sell or get rid of)" labour as one of the resources. The first time

when such a specialist person was used; it was to maintain a "buffer" between

employer and employee to meet the "legitimate need" of employees. However, it is theemployer who decided what legitimate need of his employees is. In fact, the specialist

"person" was more needed to prevent "unionisation" of employees. This was the case

before 1930s all over the world.

Environmental Influences on HRM: Since 1930s, certain developments took place which

greatly contributed to the evolution and growth of human resources management (HRM).

These developments are given below: Scientific Management

Labour Movements

Government Regulations


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PERSONNEL MANAGEMENTIN INDIA

The Personnel Management in India has been a product of various factors, labourlegislation being one of them. The importance of labour officers in Indian industry was

realised as early as 1929, when the Royal Commission on Labour was set up. In

1931, the Commission recommended the appointment of a labour officer in order to

"protect the workers from the evils of jobbery and indebtedness, to act as aspokesman of labour and to promote an amicable settlement between the workers and

management." The Commission observed that:

(i) The jobber should be excluded from the engagement and dismissal of labourand that, instead, a labour officer be appointed for this purpose;

(ii) The qualities required of a labour officer should be integrity, personality,energy, and the gift of understanding individuals and he should have a

linguistic facility. If he is of the right type, the workers will rapidly learn to

place confidence in him and regard him as a friend;

(iii) All labour should be engaged by him, and none should be dismissed

without consulting him; and(iv) The labour officer should fulfill many duties, and should particularly initiate

and administer welfare measures.

In 1931, the Bombay Mill owners Association appointed labour officers on theirown, who were required to attempt to settle grievances and disputes. Similar officers

were appointed in the jute industry in Bengal under the directions of the Jute Mills'

Association. These officers were entrusted with the responsibility of setting up food

shops, promoting sports and welfare activities. Personnel officers in the textileindustry came up from the department concerned with recruitment and the settlement

of grievances rather than from one administering welfare activities, as in other

countries (the USA and the UK). Their functions as Industrial Relations Officers to

handle grievances and prevent disputes were stressed from the beginning.During the Second World War, these officers were generally entrusted with the

handling of welfare and labour administration. Their functions were subsequently

enlarged and were influenced by the social reform movement in the country, publicconcern for improving labour administration and the growth of the modern

management movement.

Their functions thus included activities relating to welfare, personnel andindustrial relations.

The Factories Act of 1948 provides for the statutory appointment of a welfareofficer in a factory. Section 49 (1) and (2) of the Factories Act lays down that: (1) in

every factory wherein 500 or more workers are ordinarily employed the occupier shallemploy in the factory such number of welfare officers as may be prescribed; (2) thestate government may prescribe the duties, qualifications and conditions of service of

officers employed under sub-section (i). According to the Plantations Labour Act,

1951 every plantation wherein 300 or more workers are ordinarily employed theemployer shall employ such number of welfare officers as may be prescribed. The

state government may prescribe their duties, qualifications, and conditions of service.

The Mines Act, 1952 also provides that every mine wherein 500 or more persons are


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ordinarily employed, the owner, agent or manager has to appoint a suitably qualified

person as welfare officer. These Acts also prescribed the manner of their recruitment,

their salaries and conditions of service; and also laid down an elaborate list of dutiesto be performed by them, including those concerned with welfare, with day-to-day

personnel administration and with industrial relations.

In the beginning, personnel management was neither given any particular attentionnor place in the organisation system, nor did professionals find themselves involved in

the process. Its existence without any apparent assignment or responsibility was theusual picture and the so called champions and protectors of labour welfare used to

remain only on the fringe of industrial activities as an appendage to the system.

Subsequently, it was entrusted with the policing /unction within the organisation,i.e., to report on and assist the organisation in dealing with mostly discipline and

getting rid of trouble-makers. At this stage, it was mostly engaged in "fire fighting

tasks", i.e., going to the forefront at the moments of crisis, without having carried outany preventive or organising action. Incidentally, it was at this stage that, at times, the

use of welfare officers for aiding and abetting the exploitation of the working class

by certain organisations brought them on the periphery of notoriety. However, by andlarge, their appointment in industries remained only symbolic, satisfying the statutory

requirements, without any specific, constructive role to play. The "personnel man,"

who was initially known as "welfare officer," has moved on to be known as "labour

welfare officer," "personnel officer,'" "industrial relations officer" and is nowidentified as "human resource manager."

Impediments to the progress of HRM in India

There are various factors which have hindered the growth and development of

personnel management in India. Some of the important reasons are:-

1.The legal status of a Personnel Officer requires him to work in the field of welfare

and day-to-day personnel administration and industrial relations. But since the personnel function is a line responsibility and a staff functions, it cannot be

properly performed by a personnel officer.

2.The attitude of the employees towards personnel officers has not been favourable.

Management in India is still traditional and does not take the personnel officer into

its Confidence. The line executives are often regarded as those who get the material,

cut it up and hold it together and ship it out, while staff executives are those whoattempt to prevent the line boys from doing their jobs." Such ideas about the role of

the personnel managers generate frustration among them. In the words of Peter

Drucker, "the personnel manager tends to conceive his job partly as a file clerk'sjob, partly as a house-keeping job, partly as social workers job and partly as a fire-

fighter to head off union trouble or settle it."

3. Personnel Officers are even now required to spend a major portion of their time inattending to disputes and the grievances of workers. The plethora of labour laws has

encouraged trade unions to keep some matters always under litigation for the

advancement of their selfish interests. This factor keeps a personnel officer preoccupied

in litigation and away from his more important duties. As a result, he has neither thetime nor inclination for long-range planning.


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4. Lack of professional training facilities, a sense of insecurity and lack of

job

satisfaction among a large number of personnel executives drive them away fromthe profession.

5. The profession has not so far attracted the most meritorious among young

persons. Mostly those of ordinary caliber have found place in this profession. One ofthe reasons being that this profession is still considered by many to be somewhat

like a pinjrapole, an abode of useless cows.

6. The educational institutions which supply the 'material', have still the age-

oldcurriculum which falls far short of equipping the incumbents with the desired type of

fast changing knowledge and skill which could enable them to deal with human

problems effectively at the first instance.

7. The urge for updating the personnel people themselves is also mostly absent,which keeps them from being developed. The lack of initiative renders them obsolete

and incompetent for the challenging jobs.

8. Their pre-occupation with their own personal aspirations make them overlook and,

at times, ignore the expectations of all others, including the organisations.

9. By and large such professionals have not been tested in any trying situation and,

when actually put in it, have generally emerged as failures succeeding rarely. Intheir behaviour, tendencies like making false promises for cheap popularity and taking

credit for the performance of others make it difficult for them to be acceptable to

others.

10. The inability to take decisions and the lack of courage to take responsibilityfor

decisions based on their advice have been their greatest handicaps. The

professional courage to disagree is a rare virtue. Absence of such professional courageof conviction and lack of confidence in their own competence often compel them totake the line of least resistance.

11. Many a time, the personnel mean whether due to professional zeal or

personal ambition have tried to impose their will on other professions. Thistendency has been responsible for their alienation. They should shed this trait and

make an effort to integrate the expectations of all other professionals in industry

without creating the feeling of an imposition.

12. Finally, personnel management has not yet been accorded the totality of

acceptance by all concerned. It is because unlike professions such as engineering

and medicine, where the result of any faulty action or decision becomes almost

immediately obvious, the loss felt and the person responsible identified, the result offaulty decision on the management of human resources is not, by and large felt

immediately and the responsibility for it can safely be shifted to someone else. Further,

unlike other professions, the acceptance of "man-management" as a profession hasto come from employers, trade unions as well as the government. This fact makes

the profession an easy prey to politicization by government machinery, trade

unions and even by those within the organisation.


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Influence of Labour Movement on HRM: Even though modern industry began to

grow in India from 1850s, till the end of First World War, there was no industrial dispute

or unrest of importance. By end of War, on account of high price rise and economicdepression, industrial unrest took place.

Period 1900 to 1940. Important events occurred during this period are given below: "Workers Welfare League of India" was formed in UK inl911 to protect labour

interest and unity between British and Indian workers.

Russian Revolution of 1917 and emergence of communist socialisticmovement and unionism.

Growth of Indian national movement and participation of Industrial workers

in this movement.

Formation of ILO in 1919. First World War and favourable condition it created to unions.

President Woodrow Wilson's support to A.F.L, gave upper hand to labour. All

India Trade Union Congress (AITUC) was formed in 1920. Consolidation of TU

in India. First time in 1927, May Day (1st May) was celebrated in India atBombay and Indian labour formed part of international labour movement. In USA,

Congress of Industrial Organisation(CIO) was formed in 1935. While AFL represents trade of all industries, CIO

represents all tradesmen of each Industry. Both AFL and CIO provided teeth

to trade union movement in USA.

Great Depression of 1930, large-scale retrenchments, withdrawal of amenities. Ill-effect continued up to 1935. Membership of Indian TU's dropped from 2,

42,355 in 1930 to 2, 08,071 in 1934. Split in TU movement in India (1930-35).

AITUC was split into four parts viz AITUC, Indian TU Federation (ITUF) undermoderates, Red Trade Union (RTU) under communists and Independent Trade

Union like that of Ail India Railwaymens Federation (AIRF). Formation of Congress Ministries under Government of India Act 1935, in

1937 after General Election.

Spurt of activities of TU after 1937-40. Through the efforts of R.R. Gokhale, V.V.

Giri, N.M. Joshi and others TU unification was brought about-in 1940 at

Nagpur.

Period 1940 to 1970: Following are the major developments.

(1) World War Period

Outbreak of Second World War and resignation of Congress Ministry in

India (1940).

Strikes and lock-out and reign of terror unleashed by British Government onworkers and

unions opposing to British War efforts.

In 1942, for the first time, Tripartite Labour Conference was convened. This

resulted insetting up a permanent. Tripartite Consultative Machinery

Consisting of the following;


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* Plenary conference

* Standing Labour Committee.

This has enhanced the status of trade unions in India. Within a period of 4years (viz.1942 to 1946), number of TU's increased from 562 to 1087, an

increase of 121.5 per cent and total membership to 8.64 lakhs. Second World War period consolidated T.U movements and employers acceded

some of theirdemands like DA adjudication and setting up tripartite bodies.

(2) Post-War Period. This was the period which saw favourable disposal towards

labour. Following events took place during this period:

1947-India becomes independent. A socialistic democratic government was setup which favours labour.

1947-Indian National Trade Union Congress (INTUC) was formed owing

allegiance toCongress party.

In 1948, Hind Mazdoor Sabha (HMS) was supported by socialists. Leftist formed

United Trade Union Congress (UTUC) in the same year. All types of workers, professionals, technicians, journalists and even government

officers and teachers have organised unions. No. of registered TU increased to

22,484 by 1971 with a total membership of 5.5 million. In USA, AFL and CIO merged together in 1955 to become strong trade

union.

In 1970, Communist party in Indian split into two CPI and CPM. CPM formed

another TU called Centre of Indian Trade Union (CITU). Political patronage became a pattern of Indian Trade Union. Even though

initially it helped TU eventually if went against long term TU interests

because of political interference and outside leadership.

Modern Period after 1970. Trade unionism and collective bargaining is an accepted

phenomenon in India and world over. The problem and prospects of TU and labour forcevary, between developed nations and developing nations. Some of these issues are

discussed here.

Developing Nations like India

Problem of unemployment and under-employment. This cause frustration ofeducated-unemployed and large scale migration. This is mostly due to absence of

realistic National Manpower Planning.

Semi-skilled and manual labour in private and unorganized industries

are enormously exploited.

Poor training leading to very low productivity. Multiple unionism, union rivalries and lack of union leadership goes

against working interests. Social security to employees is inadequate.

Public opinion goes against frequent strikes and labour unrest. Political

interference and outside leadership are being resented by workers.Alienation between leaders and members often frustrate unionism.


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Difference between Personnel Management and HRM

Dimensions Personnel Management Human Resource Management

Employment contract Careful delineation of written

contracts

Aim to go beyond contract

Rules Importance of devising clear

rules

Can do, outlook, impatience with rule

Guide to management

action

Procedures Business need

Behavior referent Norms/customs and practices Values/mission

Managerial task vis-a vis

laborMonitoring Nurturing

Key relations Labor management Customer

Initiatives Piecemeal Integrated

Speed of decision Slow Fast

Management role Transactional Transformational leadership

Communication Indirect Direct

Prized management skills Negotiation Facilitation

Selection Separate, marginal task Integrated, key task

Pay Job evaluation (fixed grades) Performance related

Conditions Separately negotiated Harmonization

Labor management Collective-bargaining contracts Individual contracts

Job categories and grades Many Few

Job design Division of labor Team work

Conflict handling Reach temporary truce Manage climate and culture

Training and development Controlled access to courses Learning companies

Focus of attention for

interventionsPersonnel procedures Wide-ranging cultural, structural and

personnel strategies

Respect for employees Labor is treated as a tool

which is expendable andreplaceable

People are treated as assets to be used

for the benefit of an organization, itsemployees and the society as a whole

Shared interests Interests of the organization are

upper mostMutuality of Interest

Evolution Precedes HRM Latest in the evolution of the

subject

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26428518 Nature and Development of Personnel Management