Chapter 1 INTRODUCTION TO

HUMAN
RESOURCE
MANAGEMENT
DPB50123
 PREVIEW

❑ Define human resource management

❑ Identify the objectives of HRM
❑ Discuss the factors that determine the establishment of HRM in
organization:
✓ The size of organization
✓ Unionization of the workforce
✓ Ownership of the company
✓ The philosophy of top management
❑ Explain the functions of HRM
❑ Elaborate environmental factors affecting HRM

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 WHAT IS HUMAN RESOURCE
MANAGEMENT?

Human resource management is the

development and implementation of systems in
an organization for attracting, developing and
retaining a high-performing workforce.

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 THE OBJECTIVES OF HRM

➢ HR monitors the culture.

➢ HR owns the overall talent management
processes.
➢ HR is responsible for the over all recruiting of a
superior workforce.
➢ HR recommends market-based salaries and
develops an overall strategic compensation
plan.

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 THE OBJECTIVES OF HRM

➢ HR researches, recommends, and implements

employee benefits programs that attract and
retain your best employees.
➢ HR is responsible for recommending and
instituting strategies for people and the
organization that further the attainment of the
organization's strategic goals.

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 THE OBJECTIVES OF HRM

➢ HR makes sure that workplace activities,

events, celebrations, ceremonies, field trips,
and team building opportunities are occurring.
➢ HR advocates for employees who have issues
or conflict with management and coaches
managers and executives who seek a more
effective approach to working with particular
employees.

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 OTHER TITLES FOR HRM
SPECIALISTS

❑ Welfare Officer
❑ Personnel Manager
❑ Human Resource Manager
❑ Human Capital Manager

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 DO ALL ORGANIZATIONS
HAVE AN HRM DEPARTMENT?

NO!
Factors that determine the establishment of
human resource department in organization:
❑ Ownership of the company
❑ Philosophy of top management
❑ Size of the company
❑ Unionization of the workforce

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 HUMAN RESOURCE
MANAGEMENT IS A SHARED
FUNCTION
❑ In organizations with an HRM Department, the
function of HRM is shared between this
department and ALL managers and supervisors.
❑ Sharing leads to conflict.
❑ Agreement must be made so that tasks and
duties are clearly assigned.

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 PERSONAL QUALITIES AND
SKILLS REQUIRED OF HRM
SPECIALISTS
❑ Communication skills
❑ Ability to bring about change
❑ Information technology (IT) savvy
❑ Numerate and able to analyse data
❑ Ability to understand the business context
❑ High ethical standards

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 HRM VS PERSONNEL
MANAGEMENT
HRM PERSONNEL MANAGEMENT
1. Human resource management is a modern Personnel management is a traditional approach of
approach of managing people and their strengths managing people in the organization.
in the organization.

2. Human resource management focuses on Personnel management focuses on personnel

acquisition, development, motivation and administration, employee welfare and labour
maintenance of human resources in the relation.
organization.

3. Human resource management assumes people Personnel management assumes people as a input
as an important and valuable resource for for achieving desired output.
achieving desired output.

4. Administrative function is undertaken for goal Personnel function is undertaken for employee's
achievement. satisfaction.

5. Job design function is done on the basis of Job design is done on the basis of division of labour.
group work/team work.

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 CONT.:

HRM PERSONNEL MANAGEMENT

6. Employees are provided with more training and Employees are provided with less training and
development opportunities. development opportunities.

7. Decisions are made collectively after considering Decisions are made by the top management as per
employee's participation, authority, the rules and regulation of the organization.
decentralization, competitive environment etc.

8. Focuses on effectiveness, culture, productivity Focuses on increased production and satisfied

and employee's participation. employees.

9. Concerned with all level of managers from top to Concerned with personnel manager.
bottom.

10. A strategic function. A routine function.

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 HRM FUNCTIONS

Human
Resource
1
Management

Safety and
Health

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 FUNCTIONS OF THE HR
DEPARTMENT

Staffing/Employment
❑ Human resource strategic planning
❑ Job analysis
❑ Setting policies and administering disciplinary
action systems
❑ Recruitment and selection

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 FUNCTIONS OF THE HR
DEPARTMENT (cont.)

❑ Establishing career movement policies,

including transfers and promotion
❑ Terminating employees
❑ Liaison with Immigration and Labour
Department
❑ Records keeping

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 Staffing

Process of ensuring the organization always has:

❑Required number of employees
❑Employees with appropriate skills
❑Employees in the right jobs at the right time

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 Job Analysis

❑ Systematic process of determining skills, duties,

and knowledge required for performing jobs in
an organization
❑ Impacts virtually every aspect of HRM

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 Human Resource Planning

❑ Matching internal and external supply of people

with anticipated job openings over a specified
period of time
❑ Sets the stage for recruitment and other HR
actions

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 FUNCTIONS OF THE HR
DEPARTMENT (cont.)

Recruitment and Selection

Recruitment: Attracting individuals
to apply for jobs
• Must be timely
• Applicants need appropriate qualifications
• Need sufficient number of applicants
Selection: Choosing individual best suited for a
particular position and the organization
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 FUNCTIONS OF THE HR
DEPARTMENT (cont.)
Training and Development
Training: Providing learners with knowledge and skills
needed for their present jobs
Development: Offering learning that goes beyond present
job (Long-term focus).
❑ Holding induction programmes
❑ Providing skills training
❑ Organizing supervisory and management development programmes
❑ Establishing and administering performance management and
appraisal systems

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 FUNCTIONS OF THE HR
DEPARTMENT (cont.)

Performance Appraisal
❑ Goal-oriented process to ensure organizational
processes are in place to maximize productivity
❑ Applies to employees, teams, and ultimately,
the organization
❑ Formal system of review and evaluation
(Individual and team)

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 FUNCTIONS OF THE HR
DEPARTMENT (cont.)

Compensation (Payment/Reward Systems)

All rewards that individuals receive as a result of
their employment

❑ Developing a wage structure

❑ Preparing information for payroll
❑ Establishing incentive schemes
❑ Advising on benefits

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 FUNCTIONS OF THE HR
DEPARTMENT (cont.)

Compensation (Payment/Reward Systems)

Financial Compensation
Direct: Pay employee receives in form of wages, salaries,
bonuses, or commissions
Indirect: Benefits employee receives
✓ Paid vacations, sick leave, holidays, medical insurance

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 FUNCTIONS OF THE HR
DEPARTMENT (cont.)

Compensation (Payment/Reward Systems)

Non-financial Compensation
Satisfaction that employees receive from:
❑ Job itself
❑ Psychological and/or physical environment

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 FUNCTIONS OF THE HR
DEPARTMENT (cont.)

Industrial Relations
Businesses are required by law to recognize a
union and bargain with it in good faith if firm’s
employees want a union to represent them. Human
resource activity with a union.
❑ Grievance handling
❑ Relations with trade union representatives
❑ Collective bargaining negotiations
❑ Preparing for contingencies, including strike action

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 THE EMPLOYMENT LAWS

❑ The Employment Act 1955

❑ The Sabah Labour Ordinance, updated 2005
❑ The Sarawak Labour Ordinance, updated 2005
❑ The National Wages Consultative Council Act
2011
❑ The Employees Provident Fund (EPF) Act 1991

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 THE EMPLOYMENT LAWS
(cont.)

❑ The Employees Social Security Act (SOCSO)

1969
❑ The Occupational Safety and Health Act
(OSHA) 1994
❑ The Factories and Machinery Act 1967
❑ The Children and Young Persons (Employment)
Act 1966
❑ The Employment (Restriction) Act 1968

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 THE EMPLOYMENT LAWS
(cont.)

❑ The Trade Unions Act 1959

❑ The Industrial Relations Act 1967
❑ Pembangunan Sumber Manusia Bhd. Act 2001
❑ The Skills Development Fund Act 2004
❑ The National Skills Development Act 2006
❑ The Minimum Retirement Age Act 2012

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 ENVIRONMENTAL FACTORS
AFFECTING HUMAN RESOURCE
MANAGEMENT

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 Legal Considerations

➢ Federal, state, and local legislation

➢ Court decisions
➢ Presidential executive orders

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 Labor Market

➢ Potential employees located within certain

geographic area
➢ Always changing

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 Society

➢ Firm must accomplish its purpose while

complying with societal norms
Ethics: Deals with what is good and bad, or right
and wrong, and with moral duty and obligation
Corporate social responsibility: Implied, enforced,
or felt obligation of managers to serve or protect
interests of groups other than themselves

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 Unions

➢ Group of employees who have joined together to

collectively bargain with their employer
➢ Become a third party when dealing with the
company

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 Shareholders

➢ Owners of a corporation
➢ Have invested money in the firm
➢ May at times challenge programs considered
by management to be beneficial to
organization

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 Competition

➢ In product or service and labor markets

➢ Firms must maintain a supply of competent
employees
➢ Bidding war often results

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 Customers

➢ People who actually use firm’s goods and

services
➢ Employment practices should not
antagonize members of the market that the
firm serves
❑ Workforce should be capable of providing
top-quality goods and services

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 Trends & Innovations: Mobile HR
- Is the Cloud the Limit?

➢ Trend: Increased mobility of tasks performed by

HR professionals
➢ Mobile applications are available for many HR
functions
➢ Cloud computing: Means of providing software
and data via the Internet

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 HR Technology

➢ Rapid technological changes provide:

➢ Increased sophistication
➢ Ability to design more useful human resource
information systems (HRIS)

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 HRIS

➢ An organized approach for obtaining

information on which to base HR decisions
➢ An umbrella for merging the various
subsystems
➢ Mainstay HR responsibilities need an HRIS

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 Economy

➢ When economy is booming, it is often more

difficult to recruit qualified workers
➢ In economic downturn, more applicants are
typically available

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 Unanticipated Events

➢ Unforeseen occurrences in external environment

➢ Require a tremendous amount of adjustment with
regard to HRM

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 Corporate culture as a Major
Internal Environment Factor

➢ Gives people a sense of how to behave

and what they ought to be doing
➢ Topics related to corporate culture are
presented throughout this text

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