Many students of management and laypeople often hear the term HRM or Human Resource Management and wonder

about the difference between HRM and the traditional term Personnel Management. In earlier times, the Personnel Manager of a factory or firm was the person in charge of ensuring employee welfare and interceding between the management and the employees. In recent times, the term has been replaced with HR manager. This article looks at the differences in usage and scope of functions as well as the underlying theory behind these nomenclatures. In the section on introducing HRM, we briefly looked at the main differences. We shall look into them in more detail here.
Personnel Management

Traditionally the term personnel management was used to refer to the set of activities concerning the workforce which included staffing, payroll, contractual obligations and other administrative tasks. In this respect, personnel management encompasses the range of activities that are to do with managing the workforce rather than resources. Personnel Management is more administrative in nature and the Personnel Managers main job is to ensure that the needs of the workforce as they pertain to their immediate concerns are taken care of. Further, personnel managers typically played the role of mediators between the management and the employees and hence there was always the feeling that personnel management was not in tune with the objectives of the management.
Human Resource Management

With the advent of resource centric organizations in recent decades, it has become imperative to put people first as well as secure management objectives of maximizing the ROI (Return on Investment) on the resources. This has led to the development of the modern HRM function which is primarily concerned with ensuring the fulfillment of management objectives and at the same time ensuring that the needs of the resources are taken care of. In this way, HRM differs from personnel management not only in its broader scope but also in the way in which its mission is defined. HRM goes beyond the administrative tasks of personnel management and encompasses a broad vision of how management would like the resources to contribute to the success of the organization.
Personnel Management and HRM: A Paradigm Shift ?

Cynics might point to the fact that whatever term we use, it is finally about managing people. The answer to this would be that the way in which people are managed says a lot about the approach that the firm is taking. For instance, traditional manufacturing units had personnel managers whereas the services firms have HR managers. While it is tempting to view Personnel Management as archaic and HRM as modern, we have to recognize the fact that each serves or served the purpose for which they were instituted. Personnel Management was effective in the smokestack era and HRM is effective in the 21st century and this definitely reflects a paradigm shift in the practice of managing people.
Conclusion

It is clear from the above paragraphs that HRM denotes a shift in focus and strategy and is in tune with the needs of the modern organization. HRM concentrates on the planning, monitoring and control aspects of resources whereas Personnel Management was largely about mediating between the management and employees. Many experts view Personnel Management as being workforce centered whereas HRM is resource centered. In conclusion, the differences between these two terms have to be viewed through the prism of people management through the times and in context of the industry that is being studied.

HR Management vs Personnel Management While digging for the difference between Human Resources Management and Personnel Management, you are most likely going to get very divergent views, depending on which sphere of experts you question. While some strongly affirm that there is no difference between the two, others will recognize the variance, but will still acknowledge the unmistakable similarities. In lay terms however, theres a general tendency to use the terms interchangeably. The difference, when acknowledged, between HR and Personnel, is often depicted as philosophical. Personnel management encompasses more administrative disciplines of payroll issues, employment law compliance and all other related tasks. On the other hand, HR is more concerned with the management of a workforce, as this is one of the key resources that drive the day-to-day operations of a company; hence its success. Whenever a distinction is made between Human Resources and Personnel management, Human Resources is always represented to a broader extent than Personnel management. Human Resources, it is said, embodies and elaborates tasks of Personnel management, and at the same time, creates and develops teams of employees for the advantage of the company. One of HRs primary goals is to provide a suitable environment for employees to fully utilize their skills, and work at maximum efficiency levels. The tasks that are common within Personnel management, include the traditional, routine duties; thus, it is generally described as reactive, i.e. only responding to demands as they arise. Human resources, on the other hand, involves continuous innovation and strategizing to manage a companys workforce more efficiently. It is, therefore, generally considered proactive. Theres an ongoing development of policies, functions and skill assessment,s all aimed at improving the companys workforce.

While Personnel management is often not considered to be influenced by the organization, HR is generally considered as an integral part of the organizational functions. Personnel management duties are solely the domain of the Personnel department. However, with regards to HR, most of the companys senior level employees (managers) are somehow involved, and a key goal may be to engage the managers in the skills development processes needed to accomplish personnelrelated duties. In terms of performance, motivation and rewards, Personnel management typically endeavors to reward and motivate employees with salaries, bonuses, compensation and a standard paid annual leave, in order to derive employee satisfaction. For HR, the primary motivators are seen as job creativity, work groups and efficient strategies to meet challenges. Summary: Personnel management is more concerned with payroll and similar tasks, while HR is concerned with the overall management of a companys workforce. Personnel tasks are reactive, while HR tasks are generally proactive, and continuous. Personnel management is considered independent from organizational influences, while HR is dependent on input from some employees, like senior management.

Definitions
Personnel Management - Personnel Management is thus basically an administrative recordkeeping function, at the operational level. Personnel Management attempts to maintain fair terms and conditions of employment, while at the same time, efficiently managing personnel activities for individual departments etc. It is assumed that the outcomes from providing justice and achieving efficiency in the management of personnel activities will result ultimately in achieving organisational success. Human Resource Development - Human resource management is concerned with the development and implementation of people strategies, which are integrated with corporate strategies, and ensures that the culture, values and structure of the organisation, and the quality, motivation and commitment of its members contribute fully to the achievement of its goals. HRM is concerned with carrying out the SAME functional activities traditionally performed by the personnel function, such as HR planning, job analysis, recruitment and selection, employee relations, performance management, employee appraisals, compensation management, training

and development etc. But, the HRM approach performs these functions in a qualitatively DISTINCT way, when compared with Personnel Management.

Main Differences between Personnel Management and HRM

Personnel management is workforce centered, directed mainly at the organisations employees; such as finding and training them, arranging for them to be paid, explaining managements expectations, justifying managements actions etc. While on the other hand, HRM is resource centered, directed mainly at management, in terms of devolving the responsibility of HRM to line management, management development etc. Although indisputably a management function, personnel management has never totally identified with management interests, as it becomes ineffective when not able to understand and articulate the aspirations and views of the workforce, just as sales representatives have to understand and articulate the aspirations of the customers. Personnel Management is basically an operational function, concerned primarily with carrying out the day-to day people management activities. While on the other hand, HRM is strategic in nature, that is, being concerned with directly assisting an organisation to gain sustained competitive advantage.

HRM is more proactive than Personnel Management. Whereas personnel management is about the maintenance of personnel and administrative systems, HRM is about the forecasting of organisational needs, the continual monitoring and adjustment of personnel systems to meet current and future requirements, and the management of change.

27 Points of Difference between Personnel Management & HRD

No. Dimension Beliefs & Assumptions 1 Contract Careful delineation of written Aim to go beyond contracts contracts Importance of devising clear Can-do outlook; impatience with rule rules/mutuality Procedures Norms/custom & practice Monitoring Pluralist Business need Values/Mission Nurturing Unitarist Personnel Management Human Resource Development

2 Rules Guide to management Action

4 Behaviour Referent 5 Managerial Task vis-vis Labour

6 Nature of Relations

7 Conflict STRATEGIC ASPECTS 8 Key Relations 9 Initiatives 10 Corporate Plan 11 Speed of Decision LINE MANAGEMENT 12 Management Role 13 Key Managers 14 Communication 15 Standardisation 16 Prized management skills

Institutionalised

De-emphasised

Labour Management Piecemeal Marginal to Slow

Customer Integrated Central to Fast

Transactional Personnel/IR Specialists Indirect High (e.g. parity an issue) Negotiation

Transformational leadership General/business/line managers Direct Low (e.g. parity not seen as relevant) Facilitation

KEY LEVERS 17 Selection 18 Pay 19 Conditions 20 Labour Management Separate, marginal task Integrated, key task

Job Evaluation (fixed grades) Performance related Separately negotiated Collective bargaining contracts Harmonisation Towards individual contracts

21 Thrust of relations

Regularised through facilities Marginalised (with exception of some & training bargaining for change models) Few Increased flow Teamwork

22 Job categories & grades Many 23 Communication 24 Job Design Restricted flow Division of Labour

25 Conflict Handling 26 Training & Development Foci of attention of interventions

Reach temporary truces

Manage climate & culture

Controlled access to courses Learning companies Wide ranging cultural, structural & personnel strategies

27

Personnel procedures

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