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UNIVERSITY OF LAGOS

SCHOOL OF POSTGRADUATE STUDIES

MASTERS OF BUSINESS ADMINISTRATION

(PART – TIME)

FATUSIN OYINDAMOLA

YEAR 1

IRP 800

QUESTION

Identify the areas of knowledge in Human Resource Management and summarize the key

issues.

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INTRODUCTION

Human resources management (HRM) have been defined in different ways by various scholars.

For the purpose of this study, the following definitions will be considered:

- The purpose of HRM is to ensure that the employees of an organization are used in such a

way that the employer obtains the greatest possible benefit from their abilities and the

employees obtain both material and psychological rewards from their work (Graham,

1978).

- HRM is a distinctive approach to employee management which seeks to achieve

competitive advantage through the strategic deployment of a highly committed and capable

workforce, using an array of cultural, structural and personnel techniques. (Storey,1995).

- HRM is a managerial perspective which argues the need to establish an integrated series of

personnel policies to support organizational strategy. Buchanan and Huczynski, 2004).

- HRM is a strategic approach to managing employment relations which emphasizes that

leveraging people’s capabilities is critical to achieving competitive advantage, this being

achieved through a distinctive set of integrated employment policies, programmes and

practices. (Bratton and Gold,2007).

Based on these definitions, the three (3) areas of knowledge in HRM can be identified:

1. Personnel Management

2. Industrial relations

3. Industrial psychology

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PERSONNEL MANAGEMENT

Personnel management commonly referred to as the traditional approach of managing the human

resource in an organization, can be defined as a part of management that deals with the recruitment,

hiring, staffing, development, and compensation of the workforce and their relation with the

organization to achieve the organizational objectives.

It can be considered an aspect of Human Resources Management is covers a wider scope of people

management within an organization.

Elements of Personnel Management

1. Organization – This is said to be the framework of many activities taking place in order

to achieve the set goals of the organization. It can also be described as a physical framework

of various interrelated activities.

2. Job – This relates to the activities required to be performed in order to achieve the

organization’s set objectives.

3. People – This is the vital element that drives the performance of the required activities to

help the organization achieve its goals.

Importance of Personnel Management

1. To maintain competitive advantage: Part of personnel management is developing

training for employees and providing the resources they need to stay up –to-date on their

jobs some of those resources include an on-site library of industry information

encouraging employees to continue their education by subsidizing tuition costs and

notifying employees of seminars and classes that would assist in the development of their

job skills. When used in this manner, personnel management keeps your workforce current

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on the changes in the industry it allows your company to adapt quicker to changes and

keeps you ahead of the competition.

2. Retention: Human resources professionals focus on personnel manager from the

employees first interview through the rest of employees tenure a competition pay

plan and benefits package entice employees to work for your company ongoing

administration of benefits , employees carrier advancement and an interactive review

process by departmental managers help the employee to develop to her maximum

potential when personnel management is effective for each employee from the

beginning of employment , it result in a higher retention rate.

3. Team work: Effective personnel management creates strong bonds between the

company and the employee and it also encourages employees to develop a sense of

teamwork. Team building exercises help employees learn to work together , and that

works together with the focus on the individuals to create a stronger personnel

framework employees understand their role within the company and they learn to

respect the roles of others company decision follow their proper channels and

the structure of the organization in strengthened .

4. Managerial effectiveness: One of the more importance relationship for any

company is the one between a manager and an employee by developing the

employee and the team the staff understands how its action affect the productivity

of the entire department when employees take a personnel interest in the productivity

of their department this helps managers to focus more on departmental procedures

and employee development while having to focus less on administrative

responsibilities such as dispute resolution and employee turnover .

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INDUSTRIAL RELATIONS

The term ‘Industrial Relations’ comprises of two terms: ‘Industry’ and ‘Relations’. “Industry”

refers to “any productive activity in which an individual (or a group of individuals) is (are)

engaged”. By “relations” we mean “the relationships that exist within the industry between the

employer and his workmen.”. However, in a broad sense, the term Industrial Relations includes

the relationship between the various unions, between the state and the unions as well as those

between the various employers and the government. Relations of all those associated in an industry

may be called Industrial Relations.

According to International Labour Organization, Industrial relations comprise relationships

between the state on one hand and the employer’s and employee’s organization on the other, and

the relationship among the occupational organizations themselves.

According to J.T. Dunlop, “Industrial relations are the complex interrelations among managers,

workers and agencies of the government”

Several parties are involved in the Industrial relations system. The main parties are employers and

their associations, employees and their unions and the government. These three parties interact

within economic and social environment to shape the Industrial relations structure. Industrial

relations are a dynamic and developing concept, not a static one. They undergo changes with

changing structure and scenario of the industry as and when change occurs. Industrial relations

include both individual relations and collective relationships.

Objectives of Industrial Relations

• To maintain industrial democracy based on participation of labour in the management and

gains of industry.

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• To raise productivity by reducing tendency of high labour turnover and absenteeism.

• To ensure workers’ participation in management of the company by giving them a fair say

in decision-making and framing policies.

• To establish a proper channel of communication.

• To increase the morale and discipline of the employees.

• To safeguard the interests of the labour as well as management by securing the highest

level of mutual understanding and goodwill between all sections in an industry.

• To avoid all forms of industrial conflicts so as to ensure industrial peace by providing better

living and working standards for the workers.

• To bring about government control over such industrial units which are running at a loss

for protecting the livelihood of the employees.

Importance of Industrial Relations

1. Uninterrupted Production: The most important benefit of industrial benefits is that it

ensures continuity of production. This means continuous employment for all involved right

from managers to workers. There is uninterrupted flow of income for all. Smooth running

of industries is important for manufacturers, if their products are perishable goods and to

consumers if the goods are for mass consumption (essential commodities, food grains etc.).

Good industrial relations bring industrial peace which in turn tends to increase production.

2. Reduction in Industrial disputes: Good Industrial relations reduce Industrial disputes.

Strikes, grievances and lockouts are some of the reflections of Industrial unrest. Industrial

peace helps in promoting co-operation and increasing production. Thus, good Industrial

relations help in establishing Industrial democracy, discipline and a conducive workplace

environment.

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3. High morale: Good Industrial relations improve the morale of the employees and motivate

the worker workers to work more and better.

4. Reduced wastage: Good Industrial relations are maintained on the basis of co-operation

and recognition of each other. It helps to reduce wastage of material, manpower and costs.

5. Contributes to economic growth and development.

Causes of failure in Industrial Relations

1. Economic causes: Often poor wages and poor working conditions are the main causes for

unhealthy relations between management and labour. Unauthorized deductions from

wages, lack of fringe benefits, absence of promotion opportunities, faulty incentive

schemes are other economic causes. Other causes for Industrial conflicts are inadequate

infrastructure, worn-out plant and machinery, poor layout, unsatisfactory maintenance etc.

2. Organizational causes: Faulty communications system, unfair practices, non-recognition

of trade unions and labour laws are also some other causes of poor relations in industry.

3. Social causes: Uninteresting nature of work is the main social cause of poor Industrial

relations. Dissatisfaction with job and personal life culminates into Industrial conflicts.

4. Psychological causes: Lack of job security, non-recognition of merit and performance,

poor interpersonal relations are the psychological reasons for unsatisfactory employer-

employee relations.

5. Political causes: Multiple unions, inter-union rivalry weaken the trade unions. Defective

trade unions system prevailing in the country has been one of the most responsible causes

for Industrial disputes in the country.

Suggestions to improve Industrial Relations

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1. Sound personnel policies: Policies and procedures concerning the compensation, transfer

and promotion, etc. of employees should be fair and transparent. All policies and rules

relating to Industrial relations should be fair and transparent to everybody in the enterprise

and to the union leaders.

2. Participative management: Employees should associate workers and unions in the

formulation and implementation of HR policies and practices.

3. Responsible unions: A strong trade union is an asset to the employer. Trade unions should

adopt a responsible rather than political approach to industrial relations.

4. Employee welfare: Employers should recognise the need for the welfare of workers. They

must ensure reasonable wages, satisfactory working conditions, and other necessary

facilities for labour. Management should have a genuine concern for the welfare and

betterment of the working class.

5. Grievance procedure: A well-established and properly administered system committed to

the timely and satisfactory redressal of employee’s grievances can be very helpful in

improving Industrial relations. A suggestion scheme will help to satisfy the creative urge

of the workers.

6. Constructive attitude: Both management and trade unions should adopt positive attitude

towards each other. Management must recognise unions as the spokesmen of the workers’

grievances and as custodians of their interests. The employer should accept workers as

equal partners in a joint endeavour for good Industrial relations.

7. Improved communication and feedback channels: Creating a proper communication

channel to avoid grievances and misunderstandings among employees

8. Education: Education and training imparted to the employees

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INDUSTRIAL PSYCHOLOGY

Industrial Psychology is the study of human behaviour and is concerned with the discovery of

information relating to human behaviour at work. It is concerned with the application of

information about human behaviour to the various problems of industrial human life.

Objectives of industrial psychology

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1. Match the right person with the right job: Industrial Psychology has developed a whole

array of tests. By the use of systematic in-depth interviews and psychological tests such

as intelligence, aptitude, skills, abilities and interest tests, the personnel characteristics of

the persons are measured and proper man is selected and placed on the job.

2. Efficient Work Distribution: Another aim of Industrial Psychology is the proper

distribution of work according to the ability and aptitude of the employees so that they feel

satisfied and give maximum output at minimum costs.

3. Minimizing the Wastage: The Industrial Psychology also aims at minimizing the wastage

of manpower due to fatigue, illness, accidents etc. It studies several psychological factors

causing fatigue or accidents and suggests measures for preventing the accidents or

minimizing fatigue. The techniques of motivation and morale are used for this purpose.

4. Promotion of Labour Welfare: Industrial Psychology aims to promote labour welfare

through job satisfaction, increase in labour efficiency, incentive provisions etc.

5. Improvement in Human Relations: This seeks to improve the human relations in the

industry. Human relation may be defined as the “relations or contracts among individuals

in an organization and the group behaviour that emerges from these relations”. Industrial

Psychology has made significant contribution in the sphere of human relations by

developing concepts and techniques of leadership, supervision, communication and

employee participation in management.

6. Improvement in Industrial Relations: Industrial Psychology studies the attitude of

employers and employees and offers suggestions to improve the labour relations in

industries. It assumes that all individuals differ from each other in degree though not in

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kind and therefore, different measures are adopted in solving the problems like

promotions, transfers etc. relating to each individual.

7. Maximum Production: The chief aim of organization is to get the best results from the

available resources. Industrial Psychology helps in achieving this aim. The production is

automatically increased if proper selection is made, the work is distributed properly,

industrial relations are improved and human relations are promoted.

To achieve these objectives a human resource manager may engage in the following:

• To investigate and analyze in an unbiased manner the ways in which the human

psychological problems are handled at present.

• To develop new methods of problem solving and/or modify the existing methods which

have been tried and tested.

• To formulate certain principles and guidelines which will help in the solution of new

problems.

Importance of Industrial Psychology

1. Recruitment of Personnel: Psychology may help in recruiting right man for the right job.

Accurate job analysis, standardized application forms, scientific screening of applications,

use of psychological tests for vocational fitness, final overall rating and continuous review

and follow up of the entire programme are some of the areas where the psychologists can

make an important contribution. Several psychological tests may be developed for the

proper screening of the people.

2. Selection and Placement: To select the right person for the right job in the organisation,

one should measure the candidate’s aptitudes, intelligence, skills, abilities, interests and

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temperaments. It develops various devices such as interviews and psychological tests in

order to achieve the objective of the selection; it also helps in the placement of employees

at different jobs. Job requirements and abilities must tally. Scientific assignment of job

results in securing the contentment and loyalty of the working force. This is possible only

with the help of Industrial Psychology. Proper placement reduces the problem of

Indiscipline and Inefficiency in industries.

3. Training and Executive Development: After careful selection of the executives using

tests and interviews, the next step is training the executives so that they can perform better

at their present jobs. In organising an executive development programme, the Industrial

Psychologist keeps a range of goals in mind to increase the effectiveness of the executive

group. The technique of sensitivity programme helps the executives to develop his areas of

strengths and weaknesses while working in groups is a clear example.

4. Promotional Schemes: The promotion, demotion, transfer etc. of an employee should be

based on abilities, usefulness and seniority. Performance appraisal is one of the

psychological techniques to recognise the people’s ability. Mere seniority should not be

considered as the guiding principle for promotions.

5. Motivation: The psychologists assume that the causes of different types of human

behaviour in industry and business are the needs or the motives that drive an individual to

behave in a particular way. Industrial Psychology probes into the behaviour of people at

work to determine the conditions in which an employee feels motivated and is willing to

work wholeheartedly to maximize the productivity. Industrial Psychology has identified

the financial and non-financial incentives which are used by the management to motivate

the personnel.

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6. Attitude and Morale: To keep the morale of the personnel high is another significant

problem of management industrial psychologist can go into the cause of low morale of the

employees and can determine the factors influencing the relationship between attitudes of

employees and their performance. It explains the behaviour of people when they work in

groups.

7. Organizational Behaviour: Managements in various public, private and even in other

sectors, have been realizing the importance of team spirit in the organization and

redesigning their organizational structures and policies based on research findings on

organization behaviour.

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REFERENCES

1. Chris Obisi (2015) Anatomy of Personnel Management, Princeton & Associates

2. Your article library site (2018) retrieved from yourarticlelibrary.com/essay/industrial-

psychology-essay/essay-on-industrial-psychology-hrm/75273

3. MBA channel site (2014) retrieved from mbachannel.blogspot.com/2014/05/industrial-

relations.html

4. Shodhganga site: a reservoir of Indian Theses retrieved from

shodhganga.inflibnet.ac.in/bitstream/10603/76404/10/10_chapter%201.pdf

5. Decenzo David A. & Stephen Robbins P., Human Resources Management, John Wiley &

Soans Inc. New York, 1994.

6. Dunn, J.D and Stephens, EC Management of people, Me Graw Hill Book Company, New

York, 1972, P.10.

7. Human Resource Management: Meaning, Objectives, Scope and Functions by Chand

Smriti, Online Article.

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