Definition Human Resource Planning:

According to E.W. Vetter, human resource planning is “the process by which a management determines how an
organisation should make from its current manpower position to its desired manpower position.

Features of Human Resource Planning:

From the study of various definitions, the following features of human resource planning can be derived:
1. Well Defined Objectives:
Enterprise’s objectives and goals in its strategic planning and operating planning may form the objectives of human
resource planning. Human resource needs are planned on the basis of company’s goals. Besides, human resource
planning has its own objectives like developing human resources, updating technical expertise, career planning of
individual executives and people, ensuring better commitment of people and so on.

2. Determining Human Resource Reeds:

Human resource plan must incorporate the human resource needs of the enterprise. The thinking will have to be
done in advance so that the persons are available at a time when they are required. For this purpose, an enterprise
will have to undertake recruiting, selecting and training process also.

3. Keeping Manpower Inventory:

It includes the inventory of present manpower in the organisation. The executive should know the persons who
will be available to him for undertaking higher responsibilities in the near future.

4. Adjusting Demand and Supply:

Manpower needs have to be planned well in advance as suitable persons are available in future. If sufficient
persons will not be available in future then efforts should be .made to start recruitment process well in advance.
The demand and supply of personnel should be planned in advance.

5. Creating Proper Work Environment:

Besides estimating and employing personnel, human resource planning also ensures that working conditions are
created. Employees should like to work in the organisation and they should get proper job satisfaction

Need
1. Replacement of Persons:
A good number of employees are to be replaced in the undertaking because of retirement, old age, death etc. So
there will be a need to prepare and train persons for taking up vacant jobs in an enterprise.

2. Labour Turnover:
Labour turnover takes place in all enterprises. However, the degree of labour turnover may vary from company to
company but it cannot be eliminated altogether. There is always a need to recruit new employees to take up the
jobs of those who have left the undertaking.

If the undertaking is able to foresee turnover rate properly then efforts in advance are made to recruit and train
employees so that work does not suffer for want of employees.

3. Expansion Plans:
Whenever there is a proposal to expand or diversify the enterprise, more employees will be needed to occupy new
jobs. In such situations the human resource planning is necessary.

4. Technological Changes:
With research and new inventions, technological changes are coming rapidly. There may be need to give fresh
training to personnel. In addition, there may also be a need to infuse fresh blood into the enterprise. Human
resource planning will be helpful in coping to the new demands of the enterprise.

5. Assessing Future Requirements:

Human resource planning is also needed to assess whether there is any shortage or surplus employees in the
undertaking. If there is less number of employees than needed, it will badly affect the work. On the other hand, if
more persons are working than needed then it will increase labour costs, etc. Human resource planning ensures
the employment of right employees.

Objectives of Human Resource Planning:

The following are the important objectives of human resource planning in an enterprise:
1. Making assessment human resource requirements for future and making plans for recruitment and selection.

2. Assessing skill needs in future.

3. Determining training and development needs of the enterprise.

4. To assess the surplus or shortage of human resources and avoiding unnecessary dismissals.

5. To minimise imbalances caused due to non-availability of human resources of right kind, right number in right
time and at the right place.

6. Ensuring optimum use of existing human resources in the enterprise.

7. Keeping the enterprise ready to meet with the technological development and modernisation.

8. Controlling wage and salary costs.

9. Ensuring higher labour productivity.

10. Ensuring career planning of every employee of the enterprise and making succession programmes
 The type of organization determines the production process, type of staff, (supervisor and manager). And the
strategy plan of the organization defines its HR needs.

• Organizational growth cycle and planning – start up, growth, maturity, decline

• Environmental uncertainty – political, social and economical change affect all organizations.

• Outsourcing – the process by which employees transfer routine or peripheral work to the another organizations.

• Nature of job – job vacancies, promotions and expansion strategies.

• Type and quality of forecasting information - organizational structure, budgets, production.

• Time horizons – long term plans and short term plans, the greater the uncertainty the shorter the plan. Example
computers and university.

Human Resource Planning Process

1. Determining the Objectives of Human Resource Planning: The foremost step in every process is the
determination of the objectives for which the process is to be carried on. The objective for which the manpower
planning is to be done should be defined precisely, so as to ensure that a right number of people for the right kind
of job are selected. The objectives can vary across the several departments in the organization such as the
personnel demand may differ in marketing, finance, production, HR department, based on their roles or functions.
2. Analyzing Current Manpower Inventory: The next step is to analyze the current manpower supply in the
organization through the stored information about the employees in terms of their experience, proficiency, skills,
etc. required to perform a particular job. Also, the future vacancies can be estimated, so as to plan for the
manpower from both the internal (within the current employees) and the external (hiring candidates from outside)
 sources. Thus, it is to be ensured that reservoir of talent is maintained to meet any vacancy arising in the near
future.
3. Forecasting Demand and Supply of Human Resources: Once the inventory of talented manpower is maintained;
the next step is to match the demand for the manpower arising in the future with the supply or available resources
with the organization. Here, the required skills of personnel for a particular job are matched with the job
description and specification.
4. Analyzing the Manpower Gaps: After forecasting the demand and supply, the manpower gaps can be easily
evaluated. In case the demand is more than the supply of human resources, that means there is a deficit, and thus,
new candidates are to be hired. Whereas, if the Demand is less than supply, there arises a surplus in the human
resources, and hence, the employees have to be removed either in the form of termination, retirement, layoff,
transfer, etc.
5. Employment Plan/Action Plan: Once the manpower gaps are evaluated, the action plan is to be formulated
accordingly. In a case of a deficit, the firm may go either for recruitment, training, interdepartmental transfer plans
whereas in the case of a surplus, the voluntary retirement schemes, redeployment, transfer, layoff, could be
followed.
6. Training and Development: The training is not only for the new joinees but also for the existing employees who
are required to update their skills from time to time. After the employment plan, the training programmes are
conducted to equip the new employees as well as the old ones with the requisite skills to be performed on a
particular job.
7. Appraisal of Manpower Planning: Finally, the effectiveness of the manpower planning process is to be evaluated.
Here the human resource plan is compared with its actual implementation to ensure the availability of a number of
employees for several jobs.

At this stage, the firm has to decide the success of the plan and control the deficiencies, if any. Thus, human
resource planning is a continuous process that begins with the objectives of Human Resource planning and ends
with the appraisal or feedback and control of the planning process

Barriers of HRP:

Identify Crisis:
Many human resource specialists and the managers do not understand the whole manpower planning process.
Because of this, there is generally an identity crisis. Till the specialists develop a strong sense of purpose, planning
cannot be effective.

Support of Top Management:

Employees and trade unions resist manpower planning. They feel that the planning increases their overall
workload and regulates them through productivity bargaining. They also feel that it would lead to widespread
unemployment, especially of unskilled labour.

Insufficient Initial Efforts:

Successful human resource planning flourishes slowly and gradually. Sometimes sophisticated technologies are
forcefully introduced, just because competitors have adopted them. These may not be successful unless matched
with the needs abed environment of the particular enterprise.

Management Information System:

Effectiveness of planning depends upon the reliability of the information system,. In most of the Indian Industries,
human resource information system has not fully developed. In the absence of reliable data, it would not be
possible to have effective planning.

Uncertainties:
It is risky, to depend upon general estimates of manpower, in the face of rapid changes in the environment.
Absenteeism, turnover, seasonal employment, technological changes and market fluctuations are the
uncertainties, which serve as a constraints to manpower planning. Although discounts are made for these factors,
while preparing the plan, but these factors cannot be estimated correctly.,

Expensive and Time Consuming:

Manpower planning is an expensive and time consuming process. Employers may resist manpower planning,
feeling that It increases the cost of manpower.

Coordination with other Managerial functions:

There is generally a tendency on the part of the manpower planners, to remain aloof from other operating
managers and to become totally absorbed in their own world. To be effective, manpower planning must be
integrated with other management functions.

Unbalanced Approach:
Many human resource experts give more importance on the quantitative aspect of manpower, to ensure that
there is adequate flow of people in and out of the organization. They overlook the qualitative aspects like career
development and planning, skill levels, morale, etc. are overlooked by them. Such unbalanced approach affects
the effectiveness of manpower planning.

Group 2:

HRD

INTRODUCTION & EVOLUTION

Development of human resources is essential for any organisation that would like to be dynamic and growth-
oriented. Unlike other resources, human resources have rather unlimited potential capabilities. The potential can
be used only by creating a climate that can continuously identify, bring to surface, nurture and use the capabilities
of people. Human Resrouce Development (HRD) system aims at creating such a climate. A number of HRD
techniques have been developed in recent years to perform the above task based on certain principles. This unit
provides an understanding of the concept of HRD system, related mechanisms and the changing boundaries of
HRD.

HRD concept was first introduced by Leonard Nadler in 1969 in a conference in US. “He defined HRD as those
learning experience which are organized, for a specific time, and designed to bring about the possibility of
behavioral change”.

Human Resource Development (HRD) is the framework for helping employees develop their personal and
organizational skills, knowledge, and abilities. Human Resource Development includes such opportunities as
employee training, employee career development, performance management and development,
coaching, mentoring, succession planning, key employee identification, tuition assistance, and organization
development.

The focus of all aspects of Human Resource Development is on developing the most superior workforce so that the
organization and individual employees can accomplish their work goals in service to customers.

Human Resource Development can be formal such as in classroom training, a college course, or an organizational
planned change effort. Or, Human Resource Development can be informal as in employee coaching by a manager.
Healthy organizations believe in Human Resource.
Definitions of HRD

HRD (Human Resources Development) has been defined by various scholars in various ways. Some of the
important definitions of HRD (Human Resources Development) are as follows:

 According to Leonard Nadler, "Human resource development is a series of organised activities, conducted
within a specialised time and designed to produce behavioural changes."

 In the words of Prof. T.V. Rao, "HRD is a process by which the employees of an organisation are helped in
a continuous and planned way to (i) acquire or sharpen capabilities required to perform various functions
associated with their present or expected future roles; (ii) develop their journal capabilities as individual
and discover and exploit their own inner potential for their own and /or organisational development
purposes; (iii) develop an organisational culture in which superior-subordinate relationship, team work
and collaboration among sub-units are strong and contribute to the professional well being, motivation
and pride of employees." .

 According to M.M. Khan, "Human resource development is the across of increasing knowledge,
capabilities and positive work attitudes of all people working at all levels in a business undertaking."

THE CONCEPT OF HUMAN RESOURCE DEVELOPMENT

Human resource development in the organisation context is a process by which the employees of an organisation
are helped, in a continuous and planned way to:

1. Acquire or sharpen capabilities required to perform various functions associated with their present or
expected future roles;
2. Develop their general capabilities as individuals and discover and exploit their own inner potentials for
their own and/or organisational development purposes; and
3. Develop an organisational culture in which supervisor-subordinate relationships, teamwork and
collaboration among sub-units are strong and contribute to the professional well being, motivation and
pride of employees.

This definition of HRD is limited to the organisational context. In the context of a state or nation it would differ.

HRD is a process, not merely a set of mechanisms and techniques. The mechanisms and techniques such as
performance appraisal, counselling, training, and organization development interventions are used to initiate,
facilitate, and promote this process in a continuous way. Because the process has no limit, the mechanisms may
need to be examined periodically to see whether they are promoting or hindering the process. Organisations can
facilitate this process of development by planning for it, by allocating organisational resources for the purpose, and
by exemplifying an HRD philosophy that values human beings and promotes their development.

The need for HRD arises because:

(1) To create a climate free from monotony and to improve the working life,

(2) To facilitate effective communication to surface creative ability of employees in full swing,

(3) To enable the members to attain self actualization through systematically developing their potentials,

(4) Tapping the present and future creative abilities of the people to utilize for organisational development,
(5) Facilitating growth of employees and making them aware about their strengths and weaknesses,

(6) Helping organisations to utilize human resources to their maximum potentials,

(7) Availing opportunities for further development by the employees themselves

Qualities of an HRD Manager:

According to Udai Pareek and T.V. Rao that HRD manager must possess the following qualities or attributes:
(I) Technical:
(1) Knowledge of various types of performance appraisal systems and potential appraisal systems and ability to
develop them.

(2) Knowledge of various types of tests and measurements of behaviour.

(3) Ability to design and execute training programmes at various levels.

(4) Knowledge of career planning and other personnel practices.

(5) Knowledge of behavioural sciences.

(6) Knowledge and skill of counselling.

(5) Understanding of overall organisational culture.

(8) Knowledge of techniques in behavioural research.

(II) Managerial:
(1) Organising ability

(2) Systems development skills.

(III) Personality:
(1) Initiative

(2) Faith in human beings and their capabilities.

(3) Positive attitude towards others.

(4) Imagination and creativity.

(5) Concern for excellence.

(6) Concern for people and their development.

(7) Friendly, sociable and pleasant and easy to address.

(8) Attitude for research and development work.

(9) Interest in learning new things.

(10) Ability to work as a team member.

Features of Human Resource development

The essential features of human resource development can be listed as follows:

 Human resource development is a process in which employees of the organisations are recognized as its
human resource. It believes that human resource is most valuable asset of the organisation.

 It stresses on development of human resources of the organisation. It helps the employees of the
organisation to develop their general capabilities in relation to their present jobs and expected future
role.

 It emphasise on the development and best utilization of the capabilities of individuals in the interest of
the employees and organisation.

 It helps is establishing/developing better inter-personal relations. It stresses on developing relationship

based on help, trust and confidence.

 It promotes team spirit among employees.

 It tries to develop competencies at the organisation level. It stresses on providing healthy climate for
development in the organisation.

 HRD is a system. It has several sub-systems. All these sub-systems are inter-related and interwoven. It
stresses on collaboration among all the sub-systems.

 It aims to develop an organisational culture in which there is good senior-subordinate relations,

motivation, quality and sense of belonging.

 It tries to develop competence at individual, inter-personal, group and organisational level to meet
organisational goal.

 It is an inter-disciplinary concept. It is based on the concepts, ideas and principles of sociology,

psychology, economics etc.

 It form on employee welfare and quality of work life. It tries to examine/identify employee needs and
meeting them to the best possible extent.

 It is a continuous and systematic learning process. Development is a life long process, which never ends.

Scope of HRD:
 Human resource management (HRM) deals with procurement, development, compensation, maintenance and
utilization of human resources. HRD deals with efficient utilization of human resources and it is a part of HRM.
Recruitment and selection of employees for meeting the present and future requirements of an organization.

2. Performance appraisal of the employees in order to understand their capabilities and improving them through
additional training.

3. Offering the employees’ performance counselling and performance interviews from the superiors.

4. Career planning and development programmes for the employees.

5. Development of employees through succession planning.

6. Workers’ participation and formation of quality circles.

7. Employee learning through group dynamics and empowerment.

8. Learning through job rotation and job enrichment.

9. Learning through social and religious interactions and programmes.

10. Development of employees through managerial and behavioural skills.

Objectives of HRD:
The prime objective of human resource development is to facilitate an organizational environment in which the
people come first. The other objectives of HRD are as follows:

1. Equity:
Recognizing every employee at par irrespective of caste, creed, religion and language, can create a very good
environment in an organization. HRD must ensure that the organization creates a culture and provides equal
opportunities to all employees in matters of career planning, promotion, quality of work life, training and
development.

2. Employability:
Employability means the ability, skills, and competencies of an individual to seek gainful employment anywhere.
So, HRD should aim at improving the skills of employees in order to motivate them to work with effectiveness.

3. Adaptability:
Continuous training that develops the professional skills of employees plays an important role in HRD. This can
help the employees to adapt themselves to organizational change that takes place on a continuous basis.

HRD Functions:
HRD functions include the following:
1. Employee training and development,
2. Career planning and development,

3. Succession planning,

4. Performance appraisal,

5. Employee’s participation in management,

6. Quality circles,

7. Organization change and organization development.

challenges faced by HRD professionals

(a) Culture or attitude:

Different countries have different culture and as the world has become a global village HRD Professionals have to
face the cultural challenges in different countries or with the employees belonging to the different countries.
(b) Technology or skills:
The pace of technological development is very high and the new technologies are replacing the older ones quickly.
Same is the case with techniques and technologies use for training. An HR professional has to upgrade his skills and
knowledge to meet the requirements of the new generation.
(c) Values of behaviour:
The HRD professionals have to adjust themselves to the emerging new values as principle centric leadership is
becoming trend in the corporate world. Values like trust credibility timeliness and the simpler rules are becoming
the corners stone of many businesses.
(d) Knowledge or information:
Enhancement of knowledge is also a big challenge for HRD professional as they have to understand the different
philosophies demonstrated at different places in the world. For example the philosophy related to leadership
changes dramatically in organizations from different parts of the world
(e) Life style or habits:
The life style of an employee is also important for HRD professionals because they have to understand the habits
of the employees and then decide the training that needs to be imparted for bringing a change in the habits of the
employees.
(f) Knowledge of new practices:
An HRD professional has to be aware of the new practices adopted by the organization around globe. An HRD
professional should know about the practices like dignity of individual, retention of employees, leadership by
examples, clear conscience relationship with employees share holder, vendors, suppliers, customers and society at
large.
(g)Environment:
An open environment is required for the success of an organization. The organizational environment should have
meritocracy, fearless, justice, speed imagination and accountability. It is the job of the HRD professional to inspire
the employee to perform better ones this environment is created in the organization

Benefits of Human Resource Development

Human resource development now a days is considered as the key to higher productivity, better relations and
greater profitability for any organisation. Appropriate HRD provides unlimited benefits to the concerned
organisation. Some of the important benefits are being given here:

 HRD (Human Resource Development) makes people more competent. HRD develops new skill, knowledge
and attitude of the people in the concern organisations.

 With appropriate HRD programme, people become more committed to their jobs. People are assessed on
the basis of their performance by having a acceptable performance appraisal system.

 An environment of trust and respect can be created with the help of human resource development.

 Acceptability toward change can be created with the help of HRD. Employees found themselves better
equipped with problem-solving capabilities.

 It improves the all round growth of the employees. HRD also improves team spirit in the organisation.
They become more open in their behaviour. Thus, new values can be generated.

 It also helps to create the efficiency culture In the organisation. It leads to greater organisational
effectiveness. Resources are properly utilised and goals are achieved in a better way.

 It improves the participation of worker in the organisation. This improve the role of worker and workers
feel a sense of pride and achievement while performing their jobs.

 It also helps to collect useful and objective data on employees programmes and policies which further
facilitate better human resource planning.

 Hence, it can be concluded that HRD provides a lot of benefits in every organisation. So, the importance
of concept of HRD should be recognised and given a place of eminence, to face the present and future
challenges in the organisation.

Role of HRD professionals:

The concept of HRD was developed and implemented in western countries more than 30 years ago but in
developing countries it is a brand new trend and they are just getting familiar with it in a slow pace. At earlier
stages the roles played by HRD Professionals were limited as a HRD Executive/Manager or a HRD practitioner.
The HRD Executive or Manager normally assumed a leadership role in the executive development and often served
as an adviser to the chief executive officer and other executives. The outputs of this role included long-range plans
and strategies, policies, and budget allocation schedules.

On the other hand, HRD practitioners were primarily responsible for direct employee development through
fostering learning in individuals, groups or the organisation more collectively. They used to incorporate network
and build relationships directly with individual employees and managers to obtain support, resources, information,
and knowledge.

With change in the organizational environment, global economy, technology, work force the roles played by the
HRD professionals has also undergone a lot of change. At present the HRD Professionals are playing the following
roles.

Strategic adviser - helps the decision makers on issues related with HRD.

Administrator – provides coordination and support services for the delivery of HRD programs and services.

Evaluator – identify the impact of an intervention on individual or organizational effectiveness.

HR systems designer and developer- assists the HR management in designing and developing HR systems in an
organization to increase its performance.

Needs Analyst – The role of identifying ideal and current performance and performance conditions and
determining causes of discrepancies.

Organizational Change agents- helps management in designing and implementing change strategies to transform
the organization. The result is more efficient work teams, intervention strategies, and quality management and
change reports.

Organization Design Consultant- advises the management on work systems design and efficient use of available
human resources.

Instructional Designer or Learning Programme Specialist -identify the needs of the employees and develop and
design the required learning programmes. They also prepare materials and other learning aids for these
programmes.

Career Counselor - assists individual employees to assess personal competencies, values, and goals and to identify,
plan, and implement development and realistic career actions.

Coach or a Performance Consultant - advises line managers about the appropriate intervention designed to
improve the performance of the group or an individual.

Researchers - They are responsible for developing or testing new information (theory, research, concepts,
technology, models, hardware, and so on) and assess the human resource development practices and programmes
with the help of appropriate statistical procedure to find out their effectiveness and then they communicate the
results to the top level management.

Motivational aspects OF HRD:

Define motivation:

“A motive is an inner state that energizes, activates, or moves and directs or channels behaviour goals.

Motivation is one of the most important concepts in HRD. In most organizations, it is common to hear the refrain
that a particular employee is not motivated and hence his or her performance has taken a backseat. This is the
reason companies spend humungous amounts of money in arranging for training sessions and recreational events
to motivate the employees. Motivation can be understood as the desire or drive that an individual has to get the
work done. For instance, when faced with a task, it is the motivation to accomplish it that determines whether a
particular individual would complete the task according to the requirements or not. Further, the absence of
motivation leads to underperformance and loss of competitiveness resulting in loss of productive resources for the
organization. It is for this reason that the HR managers stress on the employees having high levels of motivation to
get the job done.
There are many theories of motivation and the ones being discussed here are the Herzberg’s hygiene
theory, Maslow’s need hierarchy theory, and McGregor Theory X and Theory Y.
1.Herzberg’s Two-Factor Theory of Motivation:

According to Herzberg, the opposite of “Satisfaction” is “No satisfaction” and the opposite of “Dissatisfaction” is
“No Dissatisfaction”

Herzberg classified these job factors into two categories-

a. Hygiene factors- Hygiene factors are those job factors which are essential for existence of motivation at
workplace. These do not lead to positive satisfaction for long-term. But if these factors are absent / if
these factors are non-existent at workplace, then they lead to dissatisfaction. In other words, hygiene
factors are those factors which when adequate/reasonable in a job, pacify the employees and do not
make them dissatisfied. These factors are extrinsic to work. Hygiene factors are also called as dissatisfiers
or maintenance factors as they are required to avoid dissatisfaction. These factors describe the job
environment/scenario. The hygiene factors symbolized the physiological needs which the individuals
wanted and expected to be fulfilled. Hygiene factors include:

 Pay - The pay or salary structure should be appropriate and reasonable. It must be equal and competitive
to those in the same industry in the same domain.
 Company Policies and administrative policies - The company policies should not be too rigid. They should
be fair and clear. It should include flexible working hours, dress code, breaks, vacation, etc.
 Fringe benefits - The employees should be offered health care plans (mediclaim), benefits for the family
members, employee help programmes, etc.
 Physical Working conditions - The working conditions should be safe, clean and hygienic. The work
equipments should be updated and well-maintained.
 Status - The employees’ status within the organization should be familiar and retained.
 Interpersonal relations - The relationship of the employees with his peers, superiors and subordinates
should be appropriate and acceptable. There should be no conflict or humiliation element present.
 Job Security - The organization must provide job security to the employees.

b.Motivational factors- According to Herzberg, the hygiene factors cannot be regarded as motivators. The
motivational factors yield positive satisfaction. These factors are inherent to work. These factors motivate the
employees for a superior performance. These factors are called satisfiers. These are factors involved in
performing the job. Employees find these factors intrinsically rewarding. The motivators symbolized the
 psychological needs that were perceived as an additional benefit. Motivational factors include:

 Recognition - The employees should be praised and recognized for their accomplishments by the
managers.
 Sense of achievement - The employees must have a sense of achievement. This depends on the job. There
must be a fruit of some sort in the job.
 Growth and promotional opportunities - There must be growth and advancement opportunities in an
organization to motivate the employees to perform well.
 Responsibility - The employees must hold themselves responsible for the work. The managers should give
them ownership of the work. They should minimize control but retain accountability.
 Meaningfulness of the work - The work itself should be meaningful, interesting and challenging for the
employee to perform and to get motivated.

Limitations of Two-Factor Theory

The two factor theory is not free from limitations:

1. The two-factor theory overlooks situational variables.

2. Herzberg assumed a correlation between satisfaction and productivity. But the research conducted by
Herzberg stressed upon satisfaction and ignored productivity.
3. The theory’s reliability is uncertain. Analysis has to be made by the raters. The raters may spoil the findings
by analyzing same response in different manner.
4. No comprehensive measure of satisfaction was used. An employee may find his job acceptable despite the
fact that he may hate/object part of his job.
5. The two factor theory is not free from bias as it is based on the natural reaction of employees when they
are enquired the sources of satisfaction and dissatisfaction at work. They will blame dissatisfaction on the
external factors such as salary structure, company policies and peer relationship. Also, the employees will
give credit to themselves for the satisfaction factor at work.
6. The theory ignores blue-collar workers. Despite these limitations, Herzberg’s Two-Factor theory is
acceptable broadly.

Implications of Two-Factor Theory

The Two-Factor theory implies that the managers must stress upon guaranteeing the adequacy of the hygiene
factors to avoid employee dissatisfaction. Also, the managers must make sure that the work is stimulating and
rewarding so that the employees are motivated to work and perform harder and better. This theory emphasize
upon job-enrichment so as to motivate the employees. The job must utilize the employee’s skills and
competencies to the maximum. Focusing on the motivational factors can improve work-quality.

2.Maslow’s Hierarchy of Needs Theory:

Abraham Maslow is well renowned for proposing the Hierarchy of Needs Theory in 1943. This theory is a classical
depiction of human motivation. This theory is based on the assumption that there is a hierarchy of five needs within
each individual. The urgency of these needs varies. These five needs are as follows.

1. Physiological needs- These are the basic needs of air, water, food, clothing and shelter. In other words,
physiological needs are the needs for basic amenities of life.
2. Safety needs- Safety needs include physical, environmental and emotional safety and protection. For
instance- Job security, financial security, protection from animals, family security, health security, etc.
3. Social needs- Social needs include the need for love, affection, care, belongingness, and friendship.
4. Esteem needs- Esteem needs are of two types: internal esteem needs (self- respect, confidence,
competence, achievement and freedom) and external esteem needs (recognition, power, status, attention
and admiration).
 5. Self-actualization need- This include the urge to become what you are capable of becoming / what you
have the potential to become. It includes the need for growth and self-contentment. It also includes desire
for gaining more knowledge, social- service, creativity and being aesthetic. The self- actualization needs are
never fully satiable. As an individual grows psychologically, opportunities keep cropping up to continue
growing.

According to Maslow, individuals are motivated by unsatisfied needs. As each of these needs is significantly
satisfied, it drives and forces the next need to emerge. Maslow grouped the five needs into two categories - Higher-
order needs and Lower-order needs. The physiological and the safety needs constituted the lower-order needs.
These lower-order needs are mainly satisfied externally. The social, esteem, and self-actualization needs constituted
the higher-order needs. These higher-order needs are generally satisfied internally, i.e., within an individual. Thus,
we can conclude that during boom period, the employees lower-order needs are significantly met.

Limitations of Maslow’s Theory

 It is essential to note that not all employees are governed by same set of needs. Different individuals may
be driven by different needs at same point of time. It is always the most powerful unsatisfied need that
motivates an individual.
 The theory is not empirically supported.
 The theory is not applicable in case of starving artist as even if the artist’s basic needs are not satisfied, he
will still strive for recognition and achievement.

3.Theory X and Theory Y:

In 1960, Douglas McGregor formulated Theory X and Theory Y suggesting two aspects of human behaviour at work,
or in other words, two different views of individuals (employees): one of which is negative, called as Theory X and
the other is positive, so called as Theory Y. According to McGregor, the perception of managers on the nature of
individuals is based on various assumptions.
Assumptions of Theory X

 An average employee intrinsically does not like work and tries to escape it whenever possible.
 Since the employee does not want to work, he must be persuaded, compelled, or warned with punishment
so as to achieve organizational goals. A close supervision is required on part of managers. The managers
adopt a more dictatorial style.
 Many employees rank job security on top, and they have little or no aspiration/ ambition.
 Employees generally dislike responsibilities.
 Employees resist change.
 An average employee needs formal direction.
Assumptions of Theory Y

 Employees can perceive their job as relaxing and normal. They exercise their physical and mental efforts in
an inherent manner in their jobs.
 Employees may not require only threat, external control and coercion to work, but they can use self-
direction and self-control if they are dedicated and sincere to achieve the organizational objectives.
 If the job is rewarding and satisfying, then it will result in employees’ loyalty and commitment to
organization.
 An average employee can learn to admit and recognize the responsibility. In fact, he can even learn to
obtain responsibility.
 The employees have skills and capabilities. Their logical capabilities should be fully utilized. In other words,

the creativity, resourcefulness and innovative potentiality of the employees can be utilized to solve organizational
problems.

Thus, we can say that Theory X presents a pessimistic view of employees’ nature and behaviour at work, while
Theory Y presents an optimistic view of the employees’ nature and behaviour at work. If correlate it with Maslow’s
theory, we can say that Theory X is based on the assumption that the employees emphasize on the physiological
needs and the safety needs; while Theory X is based on the assumption that the social needs, esteem needs and the
self-actualization needs dominate the employees.
McGregor views Theory Y to be more valid and reasonable than Theory X. Thus, he encouraged cordial team
relations, responsible and stimulating jobs, and participation of all in decision-making process.
Implications of Theory X and Theory Y:

Quite a few organizations use Theory X today. Theory X encourages use of tight control and supervision. It implies
that employees are reluctant to organizational changes. Thus, it does not encourage innovation

Many organizations are using Theory Y techniques. Theory Y implies that the managers should create and
encourage a work environment which provides opportunities to employees to take initiative and self-direction.
Employees should be given opportunities to contribute to organizational well-being. Theory Y encourages
decentralization of authority, teamwork and participative decision making in an organization. Theory Y searches
and discovers the ways in which an employee can make significant contributions in an organization. It harmonizes
and matches employees’ needs and aspirations with organizational needs and aspirations.

Task analysis process, just as one can anticipate from its name, assesses the extent of completion of a task from a
person, who is both an employee and a trainee at a time. Duration of the task, its complexity, allocation,
frequency, the external conditions which shape up the situations in which the task is to be done and many more
factors are also the included in task analysis. A critical and thorough task analysis is run by the professionals, who
more often belong to the human factors and ergonomics fields rather than any other.

The importance of such analysis is of immeasurable extent since it affects the costs involved, efficiency, reliability,
safety and effectiveness adversely. Generally task analysis finds its application in the last step of the process of
training needs assessment, where one has to identify the difference performances for a particular task done by an
employee before and after training. Just like its “parent process”, this one is also made to work after passing
through a series of steps.
Steps to Task Analysis Process

1. Defining the task: Identifying the task which is going to be under the analysis is the first of the task
analysis process. For the purpose, one needs to define the job type and describe each and every bit of it,
like expected procedure, desired success level, and some other things. Well! It is also that the analyst
should be aware of some more evaluation techniques that could help him while the process progresses.

2. Data Collection: One of the longest and most important steps in the task analysis process is data
collection which requires the analyst to make use of different methods and techniques to gather information
about the task under consideration. Since further advancement into the next steps of the process is only possible
when one takes this knowledge side by side while moving through each step. There are many methods for the
purpose of gathering information, and some of them are as described below:

 Job Description

Just as the name suggests, the job description is actually a narrative statement that covers most of the major
details about the job. For an applicant, the description of job gives him the idea of his expected duties and tasks.
Furthermore, the conditions under which the job will be performed are also listed in the same description.

For an analyst, an up to date copy of job description must be available, since that will greatly assist him in getting
an idea of what it is all about. Moreover, if the current copy of the application does not hold valid and out of date,
them it is important to prepare a new one by using different job analysis techniques.

 KSA Analysis: This analysis deals with an in-depth explanation of the minimum requirements of the job,
whether it is knowledge, skill, abilities or attitude. This step covers a highly detailed list of the
requirements that must be in order to carry out particular duties and tasks by an employee.

 Performance Standards: Performance standards let one get an idea of how well the employee is doing his
job and fulfilling his duties. For the purpose, one can identify the performance discrepancies by taking a
look at the objectives of the job, the importance that it holds for the cause of company and the standards,
on the basis of which it is going to be judged.

 Observations: Observing one while he is performing his job seems like one of the easiest ways but in
actually, this method requires much more expertise in the field than other ones. Because it is possible
that if the person, who is being observed, is kind of a person whose behavior changes if he knows that
someone is observing him.

 Literature Reviews: One can also get such information by reviewing the professional journals that relate
to the nature of the job, or even the best practices by doing a little research.

 Questionnaires: Making use of questionnaires for the purpose is one of the excellent ways, especially if
you want to use an averaged response from all the respondents. You can ask them a few questions and
anticipate the importance of task while keeping an eye on its objective and the time required for fulfilling
it.

 Interviews: Interviews let you have a face to face interaction with the ones who are being analyzed as a
part of task analysis. These are the best way to understand the native nature and personality of subjects
as well as to gather information like down times, repairs, wastes, quality controls, late deliveries and the
effects that all of these cast on the business.
3. Defining Objectives: This step of task analysis involves the analyst to define a task goal. This goal is what,
which determines that what were the desired results of a particular task so that it can be compared with actual
data in upcoming steps. The idea of the objective at this stage is just a vague one, which means that you don’t
need to add each and everything that can be considered as a goal at this step.

4. Disintegrating the Primary goals: By using the primary goal discovered in the previous step as the
guideline for this step, the analyst needs to break down the main goal into smaller sub-level goals. Each sub-goal,
here, can act as a smaller unit which can help in identification in the procedure of achieving the goal. This step
continues until all of the possible operations are dug out of the all the sub-goals and there is no need to further
divide it.

5. Finalizing the Analysis: The last step of the task analysis expects the analysts to compare all the gathered
data to all that which lies in the practical life. In this step, he measures the mismatch level of both the domains and
suggests some of the steps that can reduce this mismatch. And all this is done by keeping the divided sub-goals
from the previous step in consideration.

Definition and concept in CC NOTES.CHPTER 7 AND IT COVER’S HRD STRATEGIES AND EXPERIENCE IN INDIA

Methods of HR Valuation and Accounting

Posted in Human Resource Planning and Development |

There are several methods of HR valuation and accounting and these are broadly divided into two categories: The
monitory measures and non-monetary measures.

Monetary measures include

(a) Historical cost method
It suggests capitalizing the expenditure of the firm incurred on recruitment and selection, training and
development of the employees and treats them as the assets of the organization for the purpose of HR accounting.
This method suffers from a limitation that the capitalization of costs does not reflect its true value. The total
performance has to be judged in relation with the total cost associated with the HR to reflect its value.
(b) Replacement cost method
The cost of replacement of individual and the re-building cost of organization is assessed to reflect the HR asset
value of the individuals and the organization. However this method may not reflect either the actual cost or the
contribution associated with HR
(c) Opportunity cost method
This model envisages the computation of monetary value and the allocation of people to the most promising
activity and thereby assesses the opportunity cost of main employees through competitive bidding among the
investment centre.
(d) Economic value method
The value of human resource is evaluated on the basis of contribution they are likely to make in the organization
during their stay with the organization. The payments made to the employees in the form of salary, allowances
and benefits are estimated and discounted appropriately to arrive at the present economic value of the individual.
(2) Non-monetary measures:
(a) Expected realizable value method
The elements of expected realizable value like the productivity, transferability and promote-ability are measure
using personal research, appraisal techniques or other objective methods. The productivity is measured by
objective indices and managerial assessment. The promote-ability and transferability are measured in terms of
potential using psychometric tests and subjective evaluations.

(b) Discounted present value of future earnings

This method was use by Rencis Likert who proposed three sets of variables-casual, intermediate, output. These
helped in measuring the effectiveness over a period of time. Casual variable include leadership style and
behaviour, the intermediate variable are morale, motivation, commitment to goals etc. and these in turn affect the
output variables like production, sales, profit etc