Unit III Human Resource Development (HRD):

HRD Concept, Objectives, Functions etc. Syllabus

NTA UGC NET/JRF 2021 Concepts, Assumptions, Values, HRD Mechanisms, Action research
Industrial Relations and Labour welfare/HRM Model, HRD Culture and Climate, HRD Interventions, HR Accounting
CODE 55 and Audit, Consultant client relationship, Knowledge Management,
Paper 2 Human Resource Information System.
International Human Resource Management (IHRM): Organisational
Presented by context of IHRM, IHRM and Sustainable Business, Functions of IHRM,
Lakshmi Kushwaha Cross Cultural Studies, Cultural Diversity, Transnational
Follow me : [Link]/@lakshmikushwaha12-6214 Organisations, IHRM models.
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Introduction Definition
1. was first applied in 1968 in George Washington University. It was
used in Miami at the conference of American Society for Training and Development
in 1969.
Leonard Nadler
2. Human Resource Development (HRD) is that part of Human Resource Management HRD concept was first introduced by Leonard
which specifically deals with the training and development of employees.
Nadler in 1969 in a conference in US.
3. HRD helps the employees in developing their knowledge, skills and abilities to
achieve self-fulfillment and aid in the accomplishment of organizational goals. HRD as those learning experience
4. HRD is concerned with the development and implementation of people strategies, which are organized, for a specific time, and
which are integrated with corporate strategies, and ensures that the culture, values designed to bring about the possibility of
and structure of the organization, and the quality, motivation and commitment of its
members contribute fully to the achievement of its goals. behavioural
T.V. Rao(1996)
HRD is a process in which the employees of an organisation are Definition
continuously helped in a planned way to
i. Acquire or sharpen their capabilities required to perform various 1. HRD can be defined as organized learning activities arranged within an
obligations, tasks and functions; organization in order to improve performance and/or personal growth for
ii. Develop their capabilities as individuals so that they may be able to the purpose of improving the job, the individual, and/or the organization
discover their potentialities and exploit them to full for their own
and/or organisational development purposes; and 2. Human Resource Development includes such opportunities as employee
iii. To develop an organisational culture where superior subordinate training, employee career development, performance management and
relationships, team, work and collaboration among different sub-units
are strong and contribute to organisational wealth, dynamism and development, coaching, mentoring, succession planning, key employee
pride of the employees. identification, and organization development..

Objectives of HRD
Concept of HRD 1. Equity 2. Employability 3. Adaptability
1. HRD is mainly concerned with developing the skills, knowledge and Recognizing every employee Employability means the Continuous training that
competencies of people and it is people-oriented concept. at par irrespective of caste, ability, skills, and develops the professional
creed, religion and language, competencies of an skills of employees plays an
2. HRD can be applied both for the national level and organisational level can create a very good individual to seek gainful important role in HRD.
3. The concept of HRD was formally introduced by Leonard Nadler in 1969 in environment in an employment anywhere. This can help the employees
a conference organised by the American Society for Training and organization. So, HRD should aim at to adapt themselves to
Development. HRD must ensure that the improving the skills of organizational change that
organization creates a employees in order to takes place on a continuous
4. of HRD: Organisation structure, Organisational climate, culture and provides equal motivate them to work with basis.
HRD climate, HRD knowledge and skills of managers, human resources opportunities to all effectiveness.
employees in matters of
planning, recruitment and selection. career planning, promotion,
quality of work life, training
and development.
 3. Multi-disciplinary
Features of HRD subject
4. All-pervasive 5. Techniques

1. Systematic approach 2. Continuous process HRD is a Multi- HRD is an essential HRD embodies
disciplinary subject subject with techniques
HRD is a systematic and planned HRD is a continuous process for which draws inputs everywhere, be it a and processes such
approach through which the the development of all types of from behavioural manufacturing as performance
efficiency of employees is skills of employees such as science, organization or appraisal, training,
improved. technical, managerial, engineering, service sector management
behavioural, and conceptual. commerce, industry. development,
The future goals and objectives
management, career planning,
are set by the entire Till the retirement of an
economics, counselling,
organization, which are well employee sharpening of all
medicine, etc. workers
planned at individual and these skills is required.
participation and
organizational levels.
quality circles

Basis of Differentiation HRM HRD

Functions of HRD
The full form of HRD is Human Resource
The full form of HRM is Human Resource Development. It refers to continuous
Management. It refers to how the principles of development functions that are
Definition and full form
1. Employee training and development, management can be applied to manage the implemented for improving the
employees working in an organization effectively. performance of those working in an
2. Career planning and development, organization.

Nature HRM is a management function. HRD is a sub-function of HRM.

3. Succession planning,
The functions of HRD are proactive and
4. Performance appraisal, The functions of HRM are reactive and are usually
Function have to be applied consistently to
applied to gaining holistic organizational goals.
enhance the productivity of employees.
5. Employee s participation in management,
HRD goals are usually connected with
6. Quality circles, The objective of HRM is related to improving the skill development, knowledge
Goal
overall performance of employees. enhancement, and increasing the
7. Organization change and organization development. competency of employees.

Most HRM processes are routine and have to be HRD processes are ongoing and not
Process
carried out as and when the need arises. occasional.
 HUMAN RESOURCE
BASIS FOR COMPARISON PERSONNEL MANAGEMENT
HRM is an independent entity in itself. It comprises of MANAGEMENT
HRD is a subsystem of HRM and draws
different sections inclusive of recruitment and Meaning The aspect of management that is The branch of management that
Dependency many functions, attributes, and
retention, HRD, compensation, performance, appraisal
management, etc.
processes from HRM. concerned with the work force focuses on the most effective use
and their relationship with the of the manpower of an entity, to
entity is known as Personnel achieve the organizational goals is
Management. known as Human Resource
HRD is concerned with the development
HRM deals with and has concerns for people only. It of all aspects and people within an Management.
Concerned with
handles recruitment, rewards, etc. organization and manages its skill
development processes. Approach Traditional Modern
Treatment of manpower Machines or Tools Asset
HRD functions may be informal as in Type of function Routine function Strategic function
HRM functions are generally formal and are applied via mentorships, employees receive Basis of Pay Job Evaluation Performance Evaluation
Levels of formality
classroom/laboratory training, etc. coaching from superiors, usually
managers. Management Role Transactional Transformational
Communication Indirect Direct

Basis of Comparision Personnel Management HRM HRD Matrix

Labor Management Collective Bargaining Contracts Individual Contracts
HRD
Instruments
Initiatives Piecemeal Integrated
Management Actions Procedure Business needs

Decision Making Slow Fast HRD

Organizational
HRD Process
Job Design Division of Labor Groups/Teams Effectiveness Matrix
Focus Primarily on mundane activities Treat manpower of the
like employee hiring, organization as valued assets, to
remunerating, training, and be valued, used and preserved.
harmony.
HRD Outcomes
 HRD Matrix [Link]
Outcomes
HRD instruments and processes make people more committed and satisfied, where they
tend to give their best to the organization enthusiastically.
HRD Matrix identifies the interrelationships between HRD instruments,
given by T.V Rao And dynamic people is likely to do better than which does not believe in HRD concept
and committed people who, by their contributions, would make the organisation grow.
HRD These include performance appraisal, counseling, role analysis, potential
development, training, communication policies, job rotations, rewards, job
Instruments enrichment programmes, etc.
Such HRD outcomes influence organisational effectiveness in the long-run

These instruments may vary depending on the size of the organization, the
internal environment, the support and commitment of the top management, the 4. The HRD outcomes influence the organizational effectiveness, which in turn, depends on
competitive policies etc. a number of variables like environment, technology, competitors, etc.
Organizational
HRD The HRD instruments lead to the generation of HRD processes like role clarity, Effectiveness
performance planning, development climate, risk-taking, dynamism in
Processes employees. The organizational effectiveness include long term growth.
Such HRD processes should result in more competent, satisfied and committed
people that would make the organization grow by contributing their best to it

Concept of HRD Udai Pareek

The concept of human resources in HRD is not value-free. Broadly, there are three
meanings attached to the concept of HRD.
In the first place, persons working in organisations are regarded as a valuable resource implying
that there is a need to invest time and effort in their development.
Secondly, they are human resources which means that they have their own special
characteristics and, therefore, cannot be treated like material resources. The approach focuses
on the need to humanise organisational life and introduce human values in the organisation.
And thirdly, human resource does not merely focus on employees as individuals, but also on
other social realities, units and processes in the organisation. The third concept of HRD,
encompassing both human units and processes is rather wide and includes reasonably, the two
other concepts
 2. The Role : Although individual employees perform various complex roles in the organisation, it is necessary to pay attention
to these roles independently. There are three main aspects of the development of roles with which HRD must be concerned.
Six distinguishable human units are included in human resources and these are the foci or targets of HRD.
a. Optimum Stress: Each role must have enough stressors which may help the role
occupant to stretch himself/herself to meet the challenge. However, the challenge should not exceed an optimal limit,
1. The Individual Employee : The individual employee is the key unit in an organisation. HRD is primarily alternately it may produce dysfunctional stress, resulting in poor performance or damage to the health of the employees in
concerned with the development of persons working in the organisation so that they may be able to the long run
have their own fulfilment and contribute to the goals of the organisation. There are three b. Linkages: While roles in organisations are occupied by individual employees, it is
important areas relevant to development of persons or individuals in organisations. necessary to build linkages amongst the roles, as well as linkages of different roles
(a) Self-Management: The person working in his/her organisation should develop with challenging goals.
competencies to manage his/her work effectively. c. Autonomy: If individuals who occupy various roles feel that they have enough scope to take initiatives or solve
(b) Competence Building: The main contribution of HRD to the individual's development problems or do creative work, the role occupants, as well as the organisation benefits a great deal. HRD must attempt to
develop a sense of autonomy of this kind in every role, even at the lowest level in the organisation.
is in terms of building the competencies required for better performance on the job.
The individual employee comes with his/her educational background and personal
strengths and weaknesses. While working in the organisation, he/she learns new 3. The Dyad
skills which help him/her to work effectively on organisationally given roles to achieve Dyadic group defined in terms of an employee and his supervisor is the basic building block in an organisational structure. The
organisational goals. stronger the dyads are, the stronger the Organisation will be. The focus of development of dyads in an organisation would
(c) Advancement: Every employee wants to advance his/her career in the organisation. involve developing the following three aspects:
HRD should help in the process of such advancement. advancement of employees involves a two-pronged a. Trust: Effective work cannot be done in an organisation unless a trusting relationshipis established between an
approach: (i) identifying their potential for use in higher responsibilities in the organisation and (ii) employee and his immediate superior. Trust does not develop easily; enormous effort is required to develop such a
helping them to develop further potential to take up new challenges progressively. relationship.
b. Mutuality: Effective dyads will require free exchange of help between the employee
and the supervisor.

6. The Organisation : As far as the organisation is concerned, the following three aspects deserve the attention of HRD.
C. Communication: Developing effective dyads will also involve improving a. Growth: Every organisation looks forward to growing. The growth of an organisation would involve increase in
communication between the members (the employee and the supervisor). Both its size, activities and operations. Even when growth in terms of size is not attempted, the organisation may be concerned
should be able to give and take feedback. with augmentation of service quality or maintaining leadership position in its field of operations.
b. Impact: Each organisation would like to have some impact on outside organisations or customers. Impact may
4. The Teams be in terms of developing new markets, developing services or products, introducing new technology which others can
Effective teams are quite important for the performance and adaptive strength of the follow and so on.
organisation. As far as team development is concerned, there are two primary areas on c. Self-Renewal: The organisation must examine its working from time-to-time and take steps to up-date its
which HRD efforts must focus technology. It should also analyse the present and potential problems imminent in its growth, and take proactive steps to
a. Cohesion: The team should be cohesive. Well-knit teams produce synergy, and are able to utilise prepare itself to meet these challenges. Self-renewal competency is necessary for organisational
individual competencies and stimulate innovations. effectiveness and survival.
b. Resource Utilisation: Effective teams maximise the use of resource available amongst members of
the team. This would both satisfy the members, because each will contribute whatever resources one has, and
help the team to produce effective results

5. The Inter-teams
The main emphasis of inter-teams is to develop cooperation amongst various groups in the organisation (for
example, departments, divisions, functions) so that they are able to work effectively towards the common
objectives. The main focus of HRD activity for such cooperation is to develop a corporate identity
The six HRD systems of activities given by Pareek
1. Appraisal Systems
2. Career System
3. Training System
HRD SYSTEM AND SUB-SYSTEMS
4. Work Systems The scope of HRD is to develop i.e., to increase effectiveness and potential of these human units
5. Cultural System (the individual, employees, roles, teams, inter-teams, and the organisations)
6. Self Renewal Systems

5 Major HRD Interventions given by T.V Rao

1. Performance Appraisal and Potential Appraisal
2. Career Planning
3. Training
4. Organisational Development
5. Reinforcement

HRD scorecard HRD Systems Maturity Score HRD Competence Score

Employee competency and commitment The competencies of the staff from

The concept of HRD was introduced in India by T V Rao. can be developed through appropriate different groups (HRD department, top
He is regarded as the father of HRD in India. Larsen and Toubro was the pioneer in India to design and implement an HRD mechanisms (tools and systems). management, line managers and
integrated HRD system in the 1970s. In an HRD mature organization, there will supervisors, trade union leaders, and
be well-developed HRD systems such as blue / white collar employees) are
The concept of HRD scorecard was introduced in India by T.V. Rao and Dr. Udai Pareek.
Human Resource Planning and Recruitment measured. Each group is assessed on
HRD scorecard is an indicator of the level of HR maturity of an organization and its alignment with the the following dimensions:
strategy. The model is based on the assumption that competent and motivated employees are needed to provide Performance Management System
The level of HRD skills they possess.
quality products and services at competitive rates and ways that enhance customer satisfaction. Training
Attitudes and support to learning and their
The HRD SCORECARD 2500TM is an innovative tool designed by Prof. Rao (TVRLS, India) to assesses the maturity level of Career Development and Succession
own development
HR Systems in an organization. It assigns a four-letter rating to grade four critical dimensions of HRD, which are vital Planning
contributors to organizational performance: Extent to which they facilitate learning
Job Rotation
among others in the corporation and
1. HRD Systems Maturity Score OD Interventions those who work with them
2. HRD Competence Score
HR information systems (HRIS) Their attitudes and support to HRD
function and system
3. The HRD Culture
4. Business Linkage Score
 The HRD Culture: Business Linkage Score HRD Approaches/FRAMEWORK/ Model Of HRD
The HRD culture measures values and This score indicates the extent to which
processes created by the HRD tools. HRD efforts (tools, processes, culture, etc.) 1. The Strategic HR Framework Approach - Ulrich and Lake
Employees and their styles also play a are driven to achieve business goals or
crucial role in building sustainable goals of the organization. The business This framework formulated by Ulrich and Lake (1990) aims to leverage and/or align
competencies in the organisation,these needs linkage goals include HR practices to build critical organizational capabilities that enable an organization
to be measured and monitored. Business excellence including profitability to achieve its goals.
It is possible for some organizations to and other outcomes the organization is
have minimal formal HR systems and yet expected to achieve This framework offers specific tools and paths to identify how a firm can leverage
have a high level of HR competencies Internal Operational Efficiencies its HR practices.
and HRD culture. Internal Customer Satisfaction Business strategy, organizational capabilities and HR practices are the three
Specialized questionnaires have been External Customer Satisfaction important elements in this framework.
developed for measurement of HRD culture
Employee Motivation and Commitment Ulrich (1997) presented a framework for HR professionals in terms of four key roles:
for such organizations
Cost-effectiveness and Cost-Consciousness
In the traditional family owned organizations
among Employees Management of strategic human resource.
in those years where there were no systems
approaches there used to be good degree of Management of firm infrastructure.
HRD culture, which has resulted in effective Management of employee contribution.
functioning and business.
Management of transformation and change

1) The activities for managing strategic human resources include the following:
Aligning HR and business strategy: "organizational diagnosis."
Reengineering organization processes: "shared services."
2. The Integrative Framework- Yeung and Berman (1997)
Listening and responding to employees: "providing resources to employees."
The integrative framework offered by Yeung and Berman (1997) identifies three
Managing transformation and change: "ensuring capacity for
paths through which HR practices can contribute to business performance:
2 ) The activities for management of firm infrastructure include the following: (1) by building organizational capabilities;
Constant examination for improving the HR processes. (2) by improving employee satisfaction; and
constantly find new ways to do things better; be effective as administrative experts and undertake activities (3) by shaping customer and share holder satisfaction.
leading to continual reengineering of the work processes they administer. Yeung and Berman (1997) argued for dynamic changes in HR measures to refocus
efficient HR processes for staffing, training, appraising, rewarding, the priorities and resources of the HR function.
promoting, and managing the flow of employees through the organization.
They argued that HR measures should be business driven rather than HR driven;
3) The activities for managing employee contribution include listening, responding, and finding ways to provide impact driven rather than activity driven; forward looking and innovative rather
employees with resources that meet their changing demands than backward looking; and instead of focusing on individual HR practices should
focus on the entire HR system, taking into account synergies existing among all
4) The activities for managing transformation and change include identifying and framing problems, building HR practices.
relationships of trust, solving problems, creating, and fulfilling action plans
[Link] Capital Appraisal approach - Friedman et al (1998)
of Arthur Anderson 4. HRD Score Card Approach Rao (1999)
A recent approach formulated by Rao (1999) envisages that HR interventions
This approach outlined by Friedman et al (1998) of Arthur Anderson in order to make the right business impact should be mature in terms of the
consulting company is based on the belief that there are five stages in the HRD Systems, Competencies, Culture (including styles) and business linkages.
management of human capital:
The maturity level and the appropriateness of each of the subsystems of HR,
clarification stage, assessment stage, design stage, implementation stage the appropriateness of the HR structures and the level of competencies of HR
and monitoring stage. staff, line managers, top management etc.; the HRD culture (defined in terms
There are five areas of human capital management: Recruitment, retention of Openness, Collaboration, Trust, Autonomy, Proaction, Authenticity,
and retirement; Rewards and performance management; career Confrontation and Experimentation) and the congruence of the top
development, succession planning and training; organizational structure, management and HR staff styles with HRD culture, and the extent to which all
and human capital enablers. the systems and practices result in employee satisfaction and customer
A 5 × 5 matrix using these five stages and five areas could be used to satisfaction etc. are assessed through a well formulated HRD audit
evaluate and manage the human capital well

[Link] Approach(The People Capability Maturity Model) 6. The integrated systems approach of Pareek and Rao
The integrated systems approach of Pareek and Rao envisaged a separate HRD department for
Curtis and team (Curtis et. al, 1995) developed this approach for software effective designing and implementation of HRD systems.
organizations.
It envisaged strategy as a starting point (as in Ulrich and Lake, 1990); and therefore focused on
The People Capability Maturity Model (P-CMM) aims at providing guidance on how to all the systems to achieve business goals and employee satisfaction.
improve the ability of software organizations to attract, develop, motivate, organize It aimed at synergy (like in the integrated approach of Yeung and Berman), proposed the
and retain the talent needed to steadily improve their software development phased evolution of HRD function (like PCMM approach) and included most of the elements of
capability. the Human Capital approach
A fundamental premise of the maturity framework is that a practice cannot be In essence, the Integrated HRD Systems Approach of Pareek and Rao (1975) has the following
improved if it cannot be repeated elements:
The P-CMM includes practices such as work environment, communication, staffing, A separate and differentiated HRD department with full time HRD staff.
managing performance, training, compensation, competency development, career Six HRD subsystems including OD.
development, team building, and culture development. Interlinkages between the various subsystems.
The P-CMM is based on the assumptions that organizations establish and improve their Designed with 14 principles in mind.
people management practices progress through the following five stages of maturity: Linked to other subsystems of HRF
initial, repeatable, defined, managed, and optimizing
95. Human Capital Appraisal Approach of HRD function was outlined
in 1998. Who among the following has developed the Human Capital
Appraisal Approach ? (June 2019)
(1) T. V. Rao
(2) Udai Pareek
(3) Friedman
(4) Ulrich and Lake
Action Research Model Action Research (Stephens Robbins)
1. Action research is a change process based on the systematic collection of Action research consists of five steps : diagnosis, analysis, feedback, action, and
data and selection of a change action based on what the analyzed data evaluation.
indicate.
The change agent, often an outside consultant in action research, begins by
2. Its value is in providing a scientific methodology for managing planned gathering information about problems, concerns, and needed changes from
change. members of the organization. This diagnosis is analogous to the physician s
search to find specifically what ails a patient. In action research, the change
3. Action research is problem centered, client centered, and action oriented.
agent asks questions, reviews records, and interviews employees and listens to
4. Action Research is a useful method for facilitating organizational change by their concerns.
collaborating and involving the client in the entire process of diagnostic, Diagnosis is followed by analysis. What problems do people key in on? What
problem identification, experiential learning, and problem-solving process patterns do these problems seem to take? The change agent synthesizes this
information into primary concerns, problem areas, and possible actions.

Action Research (Stephens Robbins) Action Research, developed by Kurt Lewin

Action research requires the people who will participate in any change program The German-American professor Kurt Lewin, was mainly concerned with child psychology. He
to help identify the problem and determine the solution. So the third step became known for his contributions to "Gestalt psychology" and in 1951 he carried out ground
breaking research into the way in which human behaviour could be changed towards
feedback requires sharing with employees what has been found from the first democratic values and leadership. This is why he is considered to be the founder of Action
and second steps. The employees, with the help of the change agent, develop Research
action plans for bringing about any needed change
action part of action research is set in motion. The employees and the change intervenes in and during the research. This serves two purposes: firstly, according to Kurt
agent carry out the specific actions they have identified to correct the problem. Lewin, it will bring about positive change and secondly knowledge and theory will be
generated.
The final step, consistent with the scientific underpinnings of action research, is It is important that the researcher acts as a social change expert who helps and encourages
evaluation of the action plan s effectiveness, using the initial data gathered as a employees to change their behaviour towards democratic values and leadership. A cooperation
benchmark between fundamental and applied research is essential in this.
Action Research, developed by Kurt Lewin Cyclical approach: Action Research
Definition of Action Research Changes in accordance with the Action Research approach have the nature of an
Kurt Lewin as described. He described action research as a comparative research on the exception, in which stability (Freeze) is the standard, change the deviation from
conditions and effects of various forms of social action and research leading to social action that standard and behaviour modification (Unfreezing) a response.
that uses a spiral of steps, each of which is composed of a circle of planning, action and fact-
finding about the result of the action . Action research is a cyclical process of change and is connected in his change
model.
Participatory action research in education
During the Unfreezing stage a period of problem awareness takes places
Action research is also called Participatory Action Research (PAR). This concerns an individual (Planning), during the change stage new forms of behaviour are tested (Action)
method of action research. Other working methods are community-based participatory research
and school-wide action research.
and during the refreezing stage this new behaviour is reinforced and will
become a habit over time (Results).

Conditions for Action Research: Kurt Lewin

For Action Research to be successful, Kurt Lewin established a number of conditions must meet:
1. the research must be problem-oriented
2. the employee (client) must be at the centre
3. the current situation (status quo) must be included in the discussion
4. the research must produce empirically demonstrable propositions (direct and indirect
observations)
5. propositions and findings must systematically fit into a useful theory.

Answer : A
 Talent management HRD Culture & Climate
1. The human resource development climate of an organization plays a
either through their immediate contribution or in the longer term by demonstrating the highest significant role in ensuring competency, motivation and development of
levels of potential.
its employees.
Talent management is the holistic, integrated and results- and goal-oriented process of planning,
recruiting, selecting, developing, managing, and compensating employees 2. Human resource development climate can be created using appropriate
A deliberate and ongoing process that systematically identifies, assesses, develops and retains
human resource development systems and leadership styles by top
talent to meet current and future business needs and objectives management.
3. organizations have the climate, and both the formal and informal
structures combine to create what is called organizational climate.
4. HRD climate is the perception that the employees have about the
policies, procedures, practices, and conditions which exist in the
working environment

Basic Elements of Culture

Edgar H Schein suggests that culture exists on three levels: artefacts, espoused values and
What is Organisational Culture? underlying assumptions.

Organisational Culture Artefacts: Espoused Values: Basic Assumptions:

The organizational culture is a system of shared beliefs and attitudes that develop within an Artefacts are the first level of Espoused values are the second The third level of organizational
organization and guides the behaviour of its members. There are clear-cut guidelines as to how organizational culture. Artefacts level of organizational culture. culture, are the beliefs that
are the things that come together Values are things worth doing, or organization members take for
employees are to behave generally within organization. The employees need to learn how the to define a culture and reveal what the reasons for doing what we do.
particular enterprise does things. the culture is about to those who Values are the answers to the
pay attention to them. They why questions. For examples, organization, often through
Edgar Schein include products, services, and why are you reading this book? unspoken assumptions.
even behaviour patterns of the Espoused values are the reasons
invented, members of an organization. that we give for doing what we do.
discovered or developed by a given group as it learns to cope with its problems of external Schein has defined Artefacts as Schein argues that most
things that one sees, hears, and organizational cultures can trace
adaptation and internal integration that has worked well enough to be considered valuable and, feels when one encounters a new their espoused values back to the
therefore to be taught to new members as the correct way to perceive, think and fell in relation to group with an unfamiliar culture . founders of the culture.
 [Link] Culture [Link] Culture [Link] Culture [Link] Culture

Clan cultures have a The root word here is ad A market culture is a Process and procedure

Competing Values Framework friendly, collaborative

culture and can be
compared to a large
hoc. An adhocracy is a
dynamic and innovative
environment where
culture in which the goal
is to get down to
business, get work done,
are everything in a
hierarchy culture. Leaders
are there to monitor and
family i.e., a clan employees are willing to and achieve results. This facilitate adherence to
The Organizational Culture Assessment Instrument (OCAI) was developed by University of where people have a lot take chances and leaders is often a competitive tried and true ways of
Michigan business professors Robert E. Quinn and Kim S. Cameron. in common. Strong bonds are typically seen as environment, even among doing business. Costs and
of loyalty, tradition, and inspirational innovators coworkers. The purpose mistakes are kept low by
the researchers identified two key polarities: (1) internal focus and integration vs. external focus commonality generally willing to challenge of being at work in a following the rules and
and differentiation, and (2) flexibility and discretion vs. stability and control. form. assumptions and take company with this type of the guidelines that have
Has an internal focus and risks. Core values reflect culture is to make as gotten the business this
values flexibility rather change and agility much profit and capture far in the first place.
The framework focuses on four distinct types of company cultures. than stability and control Has an external focus and as much market share as Government
values flexibility possible. Amazon is a organizations are good
1. Clan great example of this type examples of this type of
2. Adhocracy of company culture, as are
3. Market Has a strong external organizations
4. Hierarchy focus and values stability Has an internal focus and
and control values stability and
control over flexibility

CLAN CULTURE ADHOCRACY CULTURE MARKET CULTURE HIERARCHY CULTURE

Primary Focus Mentorship and teamwork Risk-taking and innovation Competition and growth Structure and stability
Defining Flexibility and discretion; internal Flexibility and discretion; Stability and control; Stability and control;
Qualities: focus and integration external focus and external focus and internal focus and
differentiation differentiation integration
Motto: right
Benefits high rates of employee contributes to high profit Companies that boast With internal organization
engagement, and happy margins and notoriety. market cultures are as a priority, hierarchy
employees make for happy Employees stay motivated profitable and successful. cultures have clear
with the goal of breaking the Because the entire direction. There are well-
possibility for market growth. mold, focus on creativity and organization is externally defined processes that
new ideas, professional
development opportunitie objective employees can main objectives.
get behind and work
toward.

Drawbacks: A family-style corporate culture a chance that a new venture difficult for employees to relatively slow to adapt to
is difficult to maintain as the meaningfully engage with the changing marketplace.
company grows. Plus, with a hurt your business. their work and live out
horizontal leadership structure, foster competition between their professional encourage employee
day-to-day operations can seem employees as the pressure to purpose. feedback.
cluttered and lacking direction. come up with new ideas
mounts
Normative Culture Apathetic Exacting Integrative
Caring Culture
In such a culture, the norms and procedures of the organization are predefined and the rules and regulations are set as per the existing
guidelines.
Culture Culture Culture
Pragmatic Culture
Low concern High concern Little concern Combines
In a pragmatic culture, more emphasis is placed on the clients and the external parties.
Customer satisfaction is the main motive of the employees in a pragmatic culture.
for people, for people but for people but high concern
Baseball team Culture:
low concern minimal a high for people
A baseball team culture considers the employees as the most treasured possession of the organization.
for concern for concern for with high
In such a culture, the individuals always have an upper edge and they do not bother much about their organization. performance performance. performance. concern for
Advertising agencies, event management companies, financial institutions follow such a culture. Employees Focuses on performance.
Academy Culture love their interests of Employees are
Organizations following academy culture hire skilled individuals. company. the valued for
The roles and responsibilities are delegated according to the back ground, educational qualification and work experience of the employees.
Levels of organization. their
Fortress Culture:
commitment Little concern performance.
There are certain organizations where the employees are not very sure about their career and longevity.
and loyalty for needs of
Tough Guy Culture are high employees
In a tough guy culture, feedbacks are essential.
The performance of the employees is reviewed from time to time and their work is thoroughly monitored.

Trompenaars' four diversity cultures Incubator(Fulfillment-oriented

culture)
Guided Missile( Project-oriented
culture)
organizations secondary to highly Egalitarian
individual fulfillment task-oriented, impersonal
existence precedes organization team approach emphasized
aim at self-expression and self- cross-disciplinary
fulfillment performance emphasized
personal and egalitarian loyalty to professions / project
minimal structure; minimal greater than to company
hierarchy Motivation intrinsic
emotional commitment Eg. USA, UK, Canada
creative, innovative
Eg. Sweden
 Family(Power-oriented culture) Eiffel Tower (Role-oriented culture)
1. Edgar Schein
personal, close face-to-face hierarchal model
relationship structure more important than
hierarchal ("father knows best") function 2. Robert A Cooke
power-oriented (leader is fatherly leader is boss (not father)
figure) relationships specific; status Model
home-like work atmosphere ascribed
long-term relationships of highly bureaucratic, depersonalized
employee to company; high loyalty rules dominate; roles before people
3. Hofstede Model
values, norms, atmosphere set by careers depend upon professional
father" or "elder brother" qualifications 4. Charles Handy
symbolic of machine age
(Japan, Singapore, South Korea, (Germany, Austria)
Model
Spain, Italy, India)

[Link]

Edgar Schein model of organization culture The first level is the characteristics of the organization which can be easily viewed, heard and felt by
individuals collectively known as artifacts.
1. Edgar Henry Schein born in 1928 is a renowned professor at the MIT Sloan School of The dress code of the employees, office furniture, facilities, behavior of the employees, mission and vision
Management who has studied extensively in the field of organization management. of the organization all come under artifacts and go a long way in deciding the culture of the workplace.
2. According to Edgar Schein - Organizations do not adopt a culture in a single day, instead it is
formed in due course of time as the employees go through various changes, adapt to the
external environment and solve problems.
Organization A
3. They gain from their past experiences and start practicing it everyday thus forming the No one in organization A is allowed to dress up Organization B
culture of the workplace. casually. The employees can wear whatever they feel like.
4. The new employees also strive hard to adjust to the new culture and enjoy a stress free life. Employees respect their superiors and avoid Individuals in organization B are least bothered
unnecessary disputes. about work and spend their maximum time loitering
5. Schein believed that there are three levels in an organization culture.
The individuals are very particular about the and gossiping around.
6. Artifacts, Values, Assumed Values deadlines and ensure the tasks are accomplished The employees use derogatory remarks at the work
within the stipulated time frame. place and pull each other into controversies.
 [Link] [Link] Values

The next level according to Schein which The third level is the assumed values of the
constitute the organization culture is the values
of the employees. make a difference to the culture of the
The values of the individuals working in the organization.
organization play an important role in deciding There are certain beliefs and facts which stay
the organization culture. hidden but do affect the culture of the
The thought process and attitude of employees organization.
have deep impact on the culture of any The inner aspects of human nature come under
particular organization. the third level of organization culture.
What people actually think matters a lot for the Organizations where female workers dominate
organization? The mindset of the individual their male counterparts do not believe in late
associated with any particular organization sittings as females are not very comfortable
influences the culture of the workplace. with such kind of culture.
Male employees on the other hand would be
more aggressive and would not have any
problems with late sittings. The organizations
follow certain practices which are not discussed
often but understood on their own.

1. Constructive Culture
2. Robert A Cooke Model of Organization Culture [Link] Culture encourage healthy interaction amongst the employees.
Every employee has a way of behaving at the workplace which he feels is the correct way and [Link] individuals have the liberty to share their ideas, exchange information and discuss things to come to
would help him survive in the organization for a longer duration. an innovative solution beneficial to all.
Such perceptions of employees form the culture of the organization. [Link] discussions and exchange of ideas amongst employees. Constructive culture motivates the
According to Robert A Cooke, the culture of an organization is the way employees behave at
employees and eventually extracts the best out of them.
the workplace to ensure stable future and growth. 4. The key features of a constructive culture are:
Cooke proposed three types of culture in the organization:
1. Constructive Culture Encouragement: A
Affiliative: The employees
Achievement: A Self Actualizing: In this Constructive culture
avoid conflicts and
2. Passive Culture constructive culture helps kind of culture, an encourages employees to
unnecessary disputes and
the employees to achieve employee stays motivated deliver their level best and
3. Aggressive Culture promote a positive
the targets within the and realizes his full strive hard for furthering
ambience at the
stipulated time frame potential. the image of the
workplace.
organization.
 [Link] Culture
[Link] Culture
In a passive culture, the employees behave in a way contrary to the way they feel is correct and
should be the ideal way. Organizations following an aggressive culture promote competition amongst the employees.
In a passive culture, the main motive of the employee is to please the superiors and make his They encourage the employees to compete against each other so that each one performs better
position safe and secure in the organization. than his fellow worker.
In such a culture, employees unhappily adhere to the guidelines and follow the rules and regulations
just to save their job. employees. Every individual vies for power, attention and strive hard to win appreciation.

Approval: In such a culture Dependent: In such a The key features of such a culture are:
Conventional: Employees
culture, the performance of Avoidance: Employees tend
decisions on their own. are bound by rules and Opposition
the employees is to avoid their own personal
They need to take their regulations of the
dependent on the interests, satisfaction and Power
organization and act
simply act according to the
implementing any idea. according to the prescribed Perfectionist
they blindly follow their company s policies.
standards only.
Competitive

1. Power Distance Index

3. Hofstede Model The power distance index considers the extent to which inequality and power are
tolerated.
Hofstede also known as Geert Hofstede proposed that national and regional factors contribute Inequality and power are viewed from the viewpoint of the followers the lower level.
to the culture of the organization and eventually influence the behaviour of employees in the
organization.
According to Hofstede there are majorly five factors which influence the culture of the High power distance index Low power distance index
workplace.
1. Power Distance Index
Indicates that a culture accepts indicates that a culture
inequity and power differences, encourages organizational
2. Collectivism vs. Individualism encourages bureaucracy and structures that are flat,
3. Uncertainty Avoidance Index shows high respect for rank and decentralized decision-making
4. Femininity vs. Masculinity authority. responsibility, participative style
5. Short-Term vs. Long-Term Orientation
of management, and places
emphasis on power distribution.
 2. Individualism vs. Collectivism 3. Uncertainty Avoidance Index
The extent to which uncertainty and ambiguity are tolerated. This dimension considers
The degree to which societies are integrated into groups and their perceived obligation
and dependence on groups. how unknown situations and unexpected events are dealt with .
High uncertainty avoidance Low uncertainty avoidance
Individualism Collectivism index index
-image in this A person s self-image in this a low tolerance for a high tolerance for
category is defined as We . uncertainty, ambiguity, uncertainty, ambiguity,
Individualism indicates that Collectivism indicates that and risk-taking. The and risk-taking. The
there is greater importance there is greater importance unknown is minimized unknown is more openly
on attaining personal goals. on the goals and well-being through strict rules, accepted, and there are
of the group regulations, etc. lax rules, regulations, etc.

4. Masculinity vs. Femininity

Also 5. Long-Term Orientation vs. Short-Term Orientation
.
achievement, attitude towards sexuality equality, behavior, etc The extent to which society views its time horizon.

Long-term orientation Short-term orientation

Masculinity Femininity
focus on the future and involves focus on the near future,
distinct gender roles, fluid gender roles, delaying short-term success or involves delivering short-term
gratification in order to achieve success or gratification and
assertive, and modest, nurturing, long-term success. places a stronger emphasis on
concentrated on and concerned with emphasizes persistence, the present than the future
material achievements the quality of life. perseverance, and long-term Short-term orientation
growth. emphasizes quick results and
and wealth-building. respect for tradition.
 [Link] [Link] Culture 3. Person Culture 4. Role culture

[Link] Handy Model of Organization Culture

There are some Organizations where There are certain Role culture is a culture
organizations where the teams are formed to organizations where the where every employee is
power remains in the achieve the targets or employees feel that they delegated roles and
hands of only few people solve critical problems are more important than responsibilities according
Charles Handy born in 1932 in Ireland is a well-known philosopher who has specialized in and only they are follow the task culture. their organization. to his specialization,
organization culture. authorized to take In such organizations Such organizations follow educational qualification
decisions. individuals with common a culture known as person and interest to extract the
According to Charles Handy s model, there are four types of culture which the organizations These individuals further interests and culture. best out of him.
follow: delegate responsibilities to specializations come In a person culture, In such a culture
the other employees. together to form a team. individuals are more employees decide what
In such a culture the concerned about their best they can do and
[Link] willingly accept the
subordinates have no own self rather than the
option but to strictly organization. challenge
2. Task Culture
Power comes with
3. Person Culture instructions. responsibility in such a
The employees do not work culture.
4. Role culture have the liberty to express
their views or share their
ideas on an open forum
and have to follow what
their superior says.

Human Resource Development Climate Culture Creates Climate

HRD climate is the perception that the employees have about the policies, procedures, practices, and Organizational climate refers to the shared perceptions organizational members
conditions which exist in the working environment. have about their organization and work environment
HRD climate is characterised by the tendencies such as : Treating employees as the most important resources
, Perceiving that developing employees is the job of every manager , Believing in the capability of employees , This aspect of culture is like team spirit at the organizational level. When
Communicating openly ,Encouraging risk taking and experimentation
things are working, the effect of these attitudes will be more than the sum of
Human Resource Development Climate emphasis on
the individual parts.
1. Making efforts to help employees recognize their strengths and weaknesses
organizational climate : The shared perceptions organizational members have
2. Creating a general climate of trust about their organization and work environment.
3. Collaboration and autonomy supportive personnel policies, and
4. Supportive HRD practices
5. An optimal level of development climate is essential for facilitating HRD activities
 Pritchard and Marasick (1973)
Definition : HRD Climate HRD climate as a relatively enduring quality ofan
organizations internal environment, distinguishing it
Payne and Monsfield (1973) from other organizations, which
HRD climate as a conceptual linkage between (a) results from the behavior and practice of members
organizations and individuals that intervenes of the organization especially in top management,
between specific situation attributes or events (b) Is perceived by members of the organization,
and individual perceptions, attitudes and (c) serves as a basis for interpreting the situation,
behaviour. (d) acts as a source of pressure for directing activity

3 Broad Categories of HRD Climate

General Climate HRD Culture(OCTAPACE) HRD Mechanism

Deal with importance Openness Measure extent to which

given to human Confrontation HRD Mechanism are
resources development Trust implemented.
in general by the top These mechanisms
Autonomy
management and line include Performance
manager Proactively
appraisal Potential
Good Personnel Policies Authenticity appraisal Career planning
and positive attitudes Collaboration Performance rewards
towards development Experimentation Feedback and
counselling Training
Employee welfare for
Answer : A
quality work-life and Job
rotation.
 a) Openness b) Confrontation c) Trust
transparent environment The term signifies the actual The trust factor come with

OCTAPACE Culture(T.V Rao) Freedom to communicate,

share and interact without
hesitation. Receiving
problems which team face in
the day to day work.
It implies to face the problem
Openness which include
maintaining the
confidentiality of information
1. OCTAPACE CULTURE includes ethics, values, beliefs, attitudes, norms, feedback from customers and and find the best solutions to shared by others and
ethos, climate, environment and culture. giving ideas and suggestions get over it rather than company
to team members. stepping back to escaping the OUTCOME : Higher empathy,
2. The eight dimensions of OCTAPACE culture are openness, confrontation, OUTCOME: It helps to problems. timely support, reduced
Trust, Authenticity, pro-action, autonomy, collaboration and improve implementation of organization encourages stress and reduction and
systems and innovation& free people to recognize a simplification of forms and
experimentation which are essential for a strong and successful procedures
interaction among team problem, bring it to people
organization. mates , leaders and top concerned, explore with them
authority and clarity in setting to under it and search
3. A culture with OCTAPACE values has the greater chance of achieving high objectives and common goals. possible ways of dealing with
involvement and satisfaction, team work, growth and free flow of it.
communication within the organization The most important aspect of OUTCOME: Improved
organizational culture are the values it practices. problem solving and clarity
and Team discussions to
resolve problems

d) Authenticity e) Proactive f) Autonomy

g) Collaboration h) Experimenting
Authenticity is the Taking initiative, Autonomy is the willingness
congruence between what preplanning and taking to use power without fear
one feels and says. It is the preventive action is the and helping other to do involves working together in a It Involves using and
value underlying trust. measures of term same. team for a common cause. encouraging innovate
Authenticity is reflected in Proactive. Organisation Using and giving freedom
must be proactive in terms working out plan of actions and approaches to solve problems.
the narrowest gap between
the stated vales and the of their planning sphere implement them together.
actual behavior. OUTCOME: Taking and Organisations must avoid OUTCOME: Timely work, OUTCOME: Development of
This value is important for planning actions at Autocratic type of
immediate concerns. improved communication, new product, methods, and
the development of a environment
culture of mutuality. OUTCOME: Develops resource sharing procedures A profile of an orgn
OUTCOME: Sharing of mutual relationships, on these aspects may help to
feelings freely to improve reduce reference made to decide what elements of HRS
interpersonal senior people should be introduced in what
communication and
reduced distortion in sequences in the organization.
communicationis
 HRD Mechanism(Instruments) or Subsystem
HRD interventions should be designed and conducted using a four-phase
approach: needs assessment, design, implementation, and evaluation

1. Performance Appraisal 9. Reward system

2. Potential Appraisal 10. Organisation Development
3. Feedback Counselling 11. Quality of Working Life
4. Training 12. Human Resource Planning
5. Role Analysis 13. Recruitment, Selection and
Placement
6. Career Planning
7. Job Rotation
8. Quality Circle

[Link] Appraisal 2. Potential Appraisal 3. Feedback Counselling [Link]

Performance appraisal can be a lt refers to the identification of hidden Feedback of performance data can Training is a process that involves
valuable tool for collecting person talents and skills of a Person. be used to monitor individual the acquisition of skills, concepts
analysis data. It is future oriented, where the main development and for indentifying and attitudes in order to increase
"Performance appraisal is the objective is to valuate the potential of training needs. the effectiveness of employees in
systematic, periodic and an impartial the employees to place them in higher doing particular jobs.
rating of an employee's excellence in position in organisational hierarchy. It
Career counselling and verbal
matters pertaining to his present job can also be used as a part of rewards are integral parts of review Training is expected to provides the
and his potential for a better job" performance appraisal processes. discussions between the superior needful stimulus to initiate
The object of appraisal is to determine It is also based on the results of and the subordinate. impulses of changes in
the present state of efficiency of a performance appraisal. It helps in strengthening the management and to improve
worker in order to establish the actual It aims at development of latent superior and subordinate efficiency, productivity and
need for training. abilities of individuals. relationship, helps the executives to administrative effectiveness.
Performance appraisal is based on understand the limitation of his
current appraisal seniors and problems of his juniors
 [Link] Analysis [Link] Planning [Link] Circle (W. Edwards
[Link] Rotation [Link] system
Deming,1950)
Role analysis is a participatory process which
aims at defining the work content of a role in implementation of career plans by means of The work-task should be A quality circle is a small Rewarding employees
relation to all those with whom the role education, training, job search and rotated among the group of employees doing performance over and above
occupant has significant interaction in the acquisition of work experiences. employees so as to broaden similar or related work who their normal wages and
performance of his job their field of specialisation as meet regularly to identify, salaries is considered to be
It is aimed at generating among employees well as their knowledge analyse and solve product- an important task of the
an awareness of their strengths and about the quality problems and to HRD.
weaknesses operation as a whole, one improve general operation. To check frustration is
Individual career development is considered should be rotated once a The workers, who have a rewarding the efficient
to be a three step process: year among the various shared area of responsibility, workers for their work which
§ Identifying and organising skills, employees depending upon meet periodically to may be known as incentive.
interests, work-related needs and values their qualifications and discuss, analyse, and It will lead to better
suitability to perform new propose solutions to ongoing utilisation of human
§ Converting these inventories into
works. problems. resources at all levels which
general careers, fields and specified job-
goals and The first company in Japan is easy, cheapest, quickest
§ Testing the possibilities against the to introduce Quality Circles and surest means of
was the Nippon Wireless and increasing productivity.
realities of the organisation or the job
Telegraph Company in 1962.
market

13. Recruitment, Selection

11. Quality of Working Life(Eric Tryst, 12. Human Resource Planning [Link] building.
and Placement
10. Organisation Development
Einar Thorsurd, Fred Emery)
It is the process aimed at Recruitment is generation of This intervention helps work
ensuring that the applications for specific groups become more
Organisation development is an The condition under which the organisation will have positions of ascertaining the effective in accomplishing
organisation-wide, planned efforts workers work and live, assume the adequate number of qualification, experience, tasks.
managed from the top, placing form of another important factor qualified persons, available skills, knowledge, etc of Like process consultation,
emphasis on making appropriate contributing to workers satisfaction at proper time, performing applicants with a view to team building helps
jobs which would meet the appraising their stability for a members diagnose group
intervention in the ongoing or otherwise and consequently the needs of the organisation job. processes and devise
activities of the organisation. job satisfaction. and also provide satisfaction Placement is the process of solutions to problems.
OD provides a normative . For an employee to be able to for the individuals involved. assigning the selected It goes beyond group
candidate with the most processes, however, to
framework within which changes in work at his best, it is necessary to suitable job. include examination of the
the climate and culture of the understand that inadequate working It underlines the need for
organisation towards harnessing the and living condition produce placing right men at the right and strategies for performing
human potential for realisation of adverse mental and physical effect job so that the best results tasks. The consultant also
organisational objectives. on the employee, ultimately causing could be obtained may function as a resource
person offering expertise
decline in the efficiency.
 HR Audit Definition : HR Audit
1. The HR Audit is the process of evaluating the performance of Human
Resource Department and its activities undertaken, and the policies Dale Yoder
followed towards the accomplishment of organizational goals. Personnel audit refers to an examination and evaluation of policies,
2. The HR Audit is conducted to identify the lapses, shortcomings, gaps in the procedures and practices to determine the effectiveness of
implementation of HR functions and suggesting the remedial actions, if personnel management.
any
3. Human Resource Audit is a comprehensive method of objective and
Stephen [Link]
systematic verification of current practices, documentation, policies and
procedures prevalent in the HR system of the organization. obligations in managing its workforce and chart any corrective

Objective of HR Audit
(1) To review every aspect of management of HR to determine the
effectiveness of each programmes in an organisation.
(2) To seek explanation and information in respect of failure and success of
HR.
(3) To evaluate implementation of policies.
4) To evaluate the performance of personnel staff and employees.
(5) To seek priorities, values and goals of management philosophy.
 Approaches of HR Audit(William Werther and Keith Davis) 4. Compliance [Link] by Objective

The auditor checks the past Under MBO approach specific

[Link] 2. Outside Authority 3. Statistical actions of the company to targets are fixed.
ensure that those activities The performance is measured
The auditor identifies The auditor uses the the auditor develops
any company usually standard set as a the statistical comply with the legal against these targets. The
benchmark by the measures of requirements and is in line auditors conduct the survey of
company as a model. outside consultant performance for the actual performance and
Then the results of and then compares existing procedures. compare with the goals set.
the organization are organization s the auditors check the
compared with that performance with information, such as
that. turnover rates,
performance of HR personnel
of the model
absenteeism. against the goals set by the
company.
top management.

1. Determining the Scope 2. Determining the Audit

3. Data Collection
HR Audit Process and Type of Audit Method
Since HR is a very wide HR audits are usually This step includes the
field, the company may conducted by using a actual process of
either choose to conduct questionnaire that elicits collecting data about the
a comprehensive review information about the organization and its HR
of all HR functions or it relevant HR areas. practices.
may decide to review a The audit may also be Information is collected
[Link] few specific areas as it conducted by by using the
[Link] 5. deems necessary.
ing the 4. Setting 6. Develop interviewing managers questionnaire and by
ing the 3. Data Feedback
Scope and the Action and employees of the HR interviewing relevant HR
Audit Collection about the
Type of Standards Plans department to analyze personnel about the HR
Method Results
Audit how well they have procedures and policies
understood the being used in the
company.
how efficiently these
policies are being
implemented
 5. Feedback about the
4. Setting the Standards 6. Develop Action Plans Types of HR Audit
Results
To assess the efficiency of After collecting The findings of the audit
HR functions, the information and comparing should be categorised
information collected has the results, the audit team according to order of According to auditor According to frequency According to Goals
to be compared with some summarises the findings importance: high, medium
pre-determined standards. and provides feedback to and low.
These standards have to be HR The organization should
pre-set and any acceptable personnel and senior examine the areas of Internal Planned(Regular) Compliance Audit
level of discrepancies management in the form of weaknesses as revealed by
should be specified clearly. an audit report. the audit and find ways to
Comparing the actual The results of the audit overcome them. Continuous
results with the standards should be discussed with Conducting HR audit would External Upon Request Improvement
will give an idea about the the employees of the HR serve no practical purpose Audit
efficiency with which the department so that they if no actions are taken.
HR functions are being are made aware of the
performed. present condition of the HR In mergers and
functions in the company. Acquisitions

1. According to Auditors 2. According to their frequency

a) Internal b) External a) Regular (Planned) b) Upon request

usually on an annual base, based on company

carried out by carried out by external but other period is also an management decision; or in
specialized units in the organizations option; case of accident or
company, based on specialized audit found; for
benchmarking the
internal procedures companies upon Company with other in the
and standards company request. industry, and others.
 3. According to the goals Methods of HR Audit
b) Continuous improvement
a) Compliance audit
audit
c) In Mergers and Acquisitions Interview
Is a systematic comparison of is the systematic process of through a formal research is
HR practices against company identifying gaps and evaluated the current state of Group Discussion and
policies and/or legislation. discrepancy of HR HR management in an
The result of the audit is a department performance and organization by identifying, Workshop
detailed list of gaps comparative analysis of collecting and reviewing
and discrepancies between between what is now and critical information to
what is required and what is what could or should and determine the risk factors. HR Audit Method Observations
the current situation in the required to be. The output of the audit is a
company; The output of the audit is a report with company current
report with opportunities for state analysis, risks
improving and increase HR assessment, even in their Questionnaires
effectiveness and efficiency money equivalent, the need
on organizational and/or of alignment of the policies
functional level; and procedures of the
acquired/merged company to
Analysis of records and
acquiring one, duplicated documents
functions, etc.

2. Group Discussion &

1. Interview 3. Observations 4. Analysis of records and
Workshop
5. Questionnaires
HR auditor conducts In large organizations, Auditor observes various documents
interview of top where individual aspects of organization in
management, line interviews are not terms of physical facilities, An auditor scrutinizes and Number of questionnaires
managers and staff. possible, group meetings, discussions and analyses various records and can be designed and used by
Interview with the top discussions and other events related to
management indicates workshops are conducted organizational culture and documents such as annual the auditor to extract the
their opinion of future for diagnosis and training. reports, employee records, information about HR
plans and prospects evaluation of various This will reveal the work training documents, systems, processes, styles
available for the company aspects of HR place atmosphere and
organizational climate.
performance appraisal and competencies
Interviews with other line
managers and staff are forms, in house journals and
conducted to get periodicals etc. such scrutiny
information about reveals strength and
effectiveness of existing
HR systems, culture and weaknesses of HR functions
strategies.
 Benefits on strategic Level Benefits on operational level Benefits on administrative level

Helps align HR goals to Provides specific, measurable

corporate strategy and goals; and verifiable data of the
Introduction - HR Accounting
Identifies HR department
contributions Develops and improves current state of the function;
Makes the HR function professional image Ensures timely compliance
business-driven and reveals with legal requirements, 1. Human resource Accounting is the process of identifying and measuring
ways to strengthen its impact roles, duties and company and mandated
on achieving Company results; responsibilities, finds critical regulations, and professional data about Human resources and communicating information to the
Ensures objective data and HR problems and reasons for standards; interested parties.
information needed for the low productivity; Reviews employees files,
Company strategic planning. Encourages for greater records, registers and 2. It is the attempt to identify and report the investments made in Human
responsibility and information; resources of the organisation.
professionalism among Reviews HR information
members of HR system 3. Human Resource Accounting is the process of assigning, budgeting, and
Stimulates identity and reporting the cost of human resources incurred in an organization,
alignment of HR policies and
practices within the company; including wages and salaries and training expenses.
Reduces HR costs, through
encouraging function for more
effective forecasting and
planning.

Definition Objectives of HR Accounting

1. To furnish cost value information for making proper and effective management
Ravindra Tiwari (2012) decisions about acquiring, allocating, developing and maintaining human resources
in order to achieve cost effective organisational objectives.

report investment made in Human resources of an organization that is 2. To monitor effectively the use of human resources by the management.
3. To have an analysis of the human assets i.e. whether such assets are conserved,
depleted or appreciated.
American Accounting Association (1973) 4. To aid in the development of management principles. and proper decision making for
Human resource accounting is the process of identifying and the future by classifying financial consequences of various practices.
measuring data about human resources and communicating this 5. In all, it facilitates valuation of human resources recording the valuation in the books
information to interested parties. of account and disclosure of the information in the financial statement.
 Methods of HR

Purpose- According to Likert (1971) Accounting

Cost Based Models Value Based Model

1. It furnishes cost/value information for making management decisions about acquiring, Capitalization of Historical Present Value of future earning Model/Lev
Costs method and Schwartz Model
2. Allocating, developing, and maintaining human resources in order to attain cost-
Replacement Costs Reward Valuation Model/Flamholtz
effectiveness; model Model

3. It allows management personnel to monitor effectively the use of human resources; Opportunity Cost Valuation on Group
Model Basis
4. It provides a sound and effective basis of human asset control, that is, whether the Standard Cost The Human Asset Multiplier model - W. J.
Approach Giles and Robison
asset is appreciated, depleted or conserved;
Hermanson s Models -
5. It helps in the development of management principles by classifying the financial Unpurchased Goodwill Model

consequences of various practices. Aggregate Payment

Approach

Cost Based Model

Opportunity Cost
Historical Cost Approach Replacement Cost Method Method/Market Value
method 4. Standard Cost Approach
developed by William C. Pyle first developed by Rensis Given by Hekimian(1967) 1. This approach has been suggested by David Watson.
and assisted by R. Lee Likert and Jones
Brummet & Eric G. Flamholtz This method measures the Opportunity cost is the value 2. Under this method , employees of an organization are categorized
in 1967. cost to replace an of an asset when there is an into different groups as per their hierarchical positions.
In this approach, the actual organization s existing alternative use of it.
cost incurred in recruiting, human resource. There is no opportunity cost 3. The standard cost is fixed for each category and then their value is
hiring, training and It indicates what it would to those employees that are calculated.
developing the human cost the concern to recruit, not scarce and also those at
resources of the organization hire and train and develop the top will not be available
4. The standard cost of recruiting, placing, training and developing
is capitalized and amortized human resources to match for auction. per grade of employee is developed and established and made up
over the expected useful life the present level of As such, only scarce people to date every year , Standard method provides easy
of the human resources. efficiency. should comprise the value of implementation
The historical cost of human It is more realistic as it human resources.
resources is very similar to incorporates the current Based on competitive
the book value of the other value of firms. bidding within firm
physical assets.
 Value Based Model
1. Discounted Present value of 2. Reward valuation
3. Valuation on Group Basis
4. The Human Asset Multiplier model - W. J. Giles and
future earnings
Developed by Lev and
model/Flamholtz model
Flamholtz developed a model According to this method,
Robison
Schwartz(1971) commonly known as the valuation of employees 1. The method was advocated by W. J. Giles and Robison.
the future earnings of various Stochastic Rewards Valuation should be done on group
groups of employees are Method. (SRVM) basis by estimating their 2. They developed a human asset multiplier. This average multiplier is obtained
estimated up to the age of The method seeks to measure contribution to the total from a financial formula which is based on the market value of the
their retirement and are the value of human resources economic value of the firm. organization.
discounted at a predetermined Under this method, firm's
rate to obtain the present value to an organization at present value is determined by 3. These multipliers are then weighted for different grades of employees. In this
value of such earnings. (ROI) various services states (roles) forecasting its future earning regard employees age, experience, qualifications, expertise, remaining period
This method is similar to the that he is expected to occupy and discounting it with the are used as weight.
present value of future during the span of his working discounting factor.
earnings used in the case of life with the organization. 4. The gross value of the human resources of an organization can be computed
financial assets. The movement or progress of by just totalling all the individual values calculated separately.
people through organizational

stochastic process.

5. Hermanson s Models -Unpurchased Goodwill Model Model

According to Hermanson, the unpurchased goodwill notion is based on the In this method the approach is to adjust the discounted future salary wage payments to people
premise that the best available evidence of the present existence of unowned by performance efficiency factor (which is a ratio based on the return on investment derived by
the specified firm relative to all other firms in the economy for a specified period).
resources is the fact that a given firm earned a higher than normal rate of
income for the most recent year . Apparently, compensation measures, such as, salary are considered potentially useful to develop
a surrogate valuation model.
To rephrase the statement, Hermanson is proposing that supranormal earnings
However
are an indication of resources not shown on the balance sheet, such as, human value or to his or her current productivity.
assets.
There are several other limitations, such as, organisational compensation policy, wage and salary
the value of human resource of an organisation may be assessed by capitalizing structure, influence of unions which may not accurately reflect the individual value.
earnings in excess of normal earnings for the industry or group of companies of
which the firm is a part
 7. The five Dimensional Model:
6. Aggregate Payment Approach :S.K Chakraborty The model develop by Myers and Flowers The five dimentions of the value of human
(1976) resource are. Knowledge Skills Health Availability - Attitude
This approach has been suggested by Chakraborty (1976). 8. MORSE MODEL - Net Benefit Model
According to his model, the human resources are to be valued on a group and not in individual
basis. Valuation of human resources involves the following steps under this model This approach has been suggested by Morse (1973).
1) All the employees of an organization are divided into two groups, managerial and non-managerial. According to this approach, the value of human resources is equivalent to the present value
2) The average salary of the group is determined in the basis of the salary/wage structure prevalent in
of net benefits derived by the organization from the service of the employees.
the organization. The following steps are involved in this approach:
3) The tenure of the employment of the employees in the group is estimated on the basis of past The gross value of the services to be rendered in the future by the employees in their
experience. individual and collective capacity.
4) It is determined by multiplying the average salary of the group with the average tenure of the The value of direct and indirect future payments to the employees is determined.
employee in the group.
The excess of the value of future human resources over the value of future payments is
5) The value is discounted at the expected average after the return on capital employed over the
average tenure period to ascertain the present value of the estimated future payment. ascertained. This represents the net benefit to the enterprise because of human
resources.

Non- monetary value -based approaches:

a) Likert Model
:Rensis Likert in the 1960s was the first to research in HR and emphasized the importance of strong pressures on the
HR's qualitative variables and on its benefits in the long-run. According to Likert's model, human variable scan be
Advantages of HR Accounting
divided into three categories:
(i) Causal variables;(ii) Intervening variables; and(iii) End-result variables [Link] for manpower planning
The interaction between the causal and intervening variables affect the end-result variables by way of job
satisfaction, costs, productivity and earnings HRA provides useful information about the cost and value of human resources.
9. Certainty Equivalent Net Benefit Model /Ogan Model It shows the strengths and weakness of the human resources.
This approach has been suggested by Pekin ogan
All this information helps the managers in planning and making the right decisions
by Morse. about human resources.
According to this approach, the certainty with which the net benefit in future will accrue should also be taken into Thus, it provides useful information for Manpower Planning and Decision Making.
account, while determining the value of human resources.
The approach requires the determination of the following: 2. Information for making personnel policies
Net benefit from each employee.
Certainty factors at which the benefits will be available. HRA provides useful information for making suitable personnel policies about
The net benefits from all employees multiplied by their certainty factor will give certainty-equivalent net benefits. promotion, favorable working environment, job satisfaction of employees, etc.
3. Utilization of human resources 6. Attracts best human resources
HRA helps the organisation to make the best utilization of human Only reputed organisations conduct HRA. So, competent and capable people
resources. want to join these organisations.
[Link] placements Therefore, it attracts the best employees and managers to the organisation.

HRA helps the organisation to place the right man in the right post 7. Designing training and development programs
depending on his skills and abilities. HRA helps the organisation to design (make) a suitable training and
development program for its employees and managers.
5. Increases morale and motivation
8. Valuable information to investors
HRA shows that the organisation cares about the employees and their
welfare. HRA provides valuable information to present and future investors. They can
This increases their morale and it motivates them to work hard and use this information to select the best company for investing their money
achieve the objectives of the organisation.

Answer :B Answer :C
 Limitations [Link] is full of measurement problems
5. Employees and Unions may not like
the idea
[Link] easy to value human 2. Results in Dehumanising
3. No Evidence
assets Human Resources There is no agreement among the There is constant fear of opposition
here are no guidelines There is a possibility that HRA The much needed empirical accountants and financial professionals from trade unions.
may lead to dehumanising and evidence is yet to be found to regarding the measurement process. Placing a value on employees would
human resources. manipulation employees. support the hypothesis that In what form and manner should their prompt them to seek rewards
After valuing human For example, a person having a HRA as a managerial tool
facilitates better and effective
value be included in the financial compensation based on such valuation.
resources in a specific way, lower value may feel
many of them may leave the discouraged and this, in itself, management of human statements? HRA may lead to division among the
organisation. may affect his competence in resources. To compound the problems further, ranks of employees.
Human life itself is uncertain work there is the question of deciding the A group of employees may be valued
and hence valuing the asset recovery rates. If a valuation has to be lower than their real worth owing to
placed on human resources, how should manipulative practices on the part of
is not proper.
it be amortised? the management.
Like physical assets, human
assets cannot be owned, Unions may fight such manipulative
retained and utilised at the practices.
sweet will and pleasure of an
organisation.

42.
Turner & Hodge (1970) areas of concern in study of
Professionalism.
Degree of Substantive Theory and
Degree of Monopoly
Technique:
A Profession should have a set The profession should claim a monopoly
of abstract principles, which should be over the set of activities in which it offers
organized into theory, set of theories or at services.
least a complex web of theoretical The bid for recognition may take form of
orientations. claim to exclusive possession of knowledge
Knowledge of a profession is passed on to and associated techniques, or at least to
next generations through these theories. their greatly superior application
Techniques for recurrent application of
these fundamental principles should be
developed. There should be a correlation
between Theory and Techniques
 Degree of External
Recognition:
Degree of Organization Degree of Organization:
Public recognition is a Two general approaches to A) Formal Organization Approach: In this approach, the emphasis is
on a) Organizational mechanisms and techniques. b) The
critical aspect of any the organization of enumeration , registration and licensing of competent professionals.
profession Professions and c) Codification of standards of practice and conduct. d) Application
But public recognition is a professionalizing of formal control over members.
multi- faceted phenomenon. occupations have been B) Community Approach: The emphasis is on qualitative aspect of
There are several possible developed. (a) Formal the relationship among a group of professionals and between a
publics to whom members Organization Approach (b) professional community and the wider society
of an occupation may Community Approach.
address themselves.

The Elements of Professionalization

Harries Jenkins (1970) identifies the following elements of professionalization in his paper
Introduction - Benchmarking
1) Structural element: a) Specialization: The exclusive nature of group activity b) Centralization: 1. Benchmarking i.e. Comparing your business performance against certain
The locus of authority- sanctions mechanism c) Standardization: The control of non-occupational reference points is a popular and potentially powerful way to glean insights
behavior that can lead to improved performance
2) Contextual element: a) Spatio- temporal dimension b) Size of occupational group c) Resources
of occupational group d) Group Relations 2. A measurement of the quality of an organization's policies, products,
programs, strategies, etc., and their comparison with standard measurements,
3) Activity element: a) The goals of occupational group b) The role of individual members
or similar measurements of its peers.
4) Educational element: a) Occupational intelligence requirements b) Basis of systematic theory
c) Institutionalized educational process d) Length of training e) Cost of training Benchmarking, is a tool of strategic management, that allows
5) Ideological element: a) Personality involvement b) Sense of group identity c) Group culture d) the organization to set goals and measure productivity, on the basis of the best
Status e) Socialization process industry practices. It is a practice in which quality level is used as a point of
6) Behavioural element: a) Code of conduct b) Evaluation of merit reference to evaluate things by making a comparison.
 Types of
Objectives Benchmarking
(1) to determine what and where improvements are called for,
(2) to analyze how other organizations achieve their high performance levels, and
(3) to use this information to improve performance.
Internal External
It is a useful technique for enhancing the performance by identifying Benchmarking Benchmarking
and implementing the finest process and practices, for achieving them.
Benchmarking does not provide a solution to all the problems rather it analyses
the situations and processes and helps in improving the performance Process Performance Strategic
It is a continuous improvement process Benchmarking Benchmarking Benchmarking

Process of Benchmarking Balance Score Card

[Link] [Link] 1. Accounting academic Dr. Robert Kaplan and business executive and theorist Dr.
[Link] the
the existing support and [Link] best David Norton first introduced the balanced scorecard.
need for
process and approval from the practices.
Benchmarking 2. The Harvard Business Review first published it in the 1992 article "The Balanced
practices top management
Scorecard Measures That Drive Performance."
3. A balanced scorecard is a strategic management performance metric used to
[Link] a identify and improve various internal business functions and their resulting
[Link] of comparison external outcomes.
[Link]
report, regarding between the 4. Balanced scorecards are used to measure and provide feedback to organizations
[Link] and steps necessary
the differences in
review for filling gaps in
performance.
standard and and performance 5. The HR Scorecard put together by Becker, Huselid and Ulrich, which
actual results with those of have been further substantiated by industry and academic research to
rivals. create The Workforce Scorecard by Huselid, Becker and Beatty.
 Characteristics/Perspective of Balance Score card
Balance Score Card [Link] and growth
The balanced scorecard involves measuring four main aspects of a business: Learning and growth are analyzed through the investigation of training and knowledge resources.
This first leg handles how well information is captured and how effectively employees use the information to convert it to
1. learning and growth, a competitive advantage over the industry.
2. business processes, [Link] processes
3. customers, and Business processes are evaluated by investigating how well products are manufactured.
Operational management is analyzed to track any gaps, delays, bottlenecks, shortages, or waste.
4. finance.
Customer perspectives
The balanced scorecard is used to attain objectives, measurements, initiatives, and goals Customer perspectives are collected to gauge customer satisfaction with quality, price, and availability of products or services.
that result from these four primary functions of a business. Customers provide feedback about their satisfaction with current products.
An organization may use the balanced scorecard model to implement strategy mapping to Financial data
see where value is added within an organization. A company also uses a balanced scorecard Financial data, such as sales, expenditures, and income are used to understand financial performance.
to develop strategic initiatives and strategic objectives. These financial metrics may include dollar amounts, financial ratios, budget variances, or income targets.

Development process of Balance Scorecard

[Link] goals,
4. Choose action plans,
indicators to and initiatives
[Link] measure and
the critical monitor
success factors performance
[Link] the
strategic
objectives

[Link]
a clear
Answer : D
vision of
the future
 Business Process Reengineering
1. The Business Process Reengineering or BPR is the analysis and redesign of core
business processes to achieve the substantial improvements in its performance,
productivity, and quality.
2. Redesigning business processes, usually by combining steps, so that small
multifunction process teams using information technology do the jobs formerly
done by a sequence of departments.
3. The business process refers to the set of interlinked tasks or activities performed to
achieve a specified outcome.
4. The business process reengineering means to change the way an individual performs
the work such that better results are accomplished.
5. The purpose of business process reengineering is to redesign the workflows in
order to dramatically improve the customer service, achieve higher levels of
efficiency, cut operational costs and become a world-class competitor.

Defined by Michael Hammer and James Champy (in their 1993 book 'Reengineering The Corporation') as
"Fundamental rethinking and radical redesign of business process to achieve dramatic improvements in
critical measures of performance such as cost, service, and speed." HR Metrics(Metrics = data analysis)
1. HR metrics are indicators that enable HR to track and measure performance on different aspects
The basic reengineering approach is to: and ultimately predict the future.
1. Identify a business process to be redesigned (such as processing an insurance claim) 2. HR metrics are a vital method for quantifying the impact and cost of HR processes and employee
2. Measure the performance of the existing processes programs.
3. Identify opportunities to improve these processes 3. It is also a strategy for measuring the progress or collapse of HR actions. HR metrics can uncover a
4. Redesign and implement a new way of doing the work focus or improvement as well as those ready for capitalization.
5. Assign ownership of sets of formerly separate tasks to an individual or a team who use new computerized
4. From fundamental HR capability to revealing the precise value of each new worker, HR metrics
systems to support the new arrangement are priceless for evaluating your business and devising future approaches.
5. The most intuitive, user-friendly HR administration programs can make employing HR metrics
easy, straightforward, and uncomplicated.
 6 elements of Metrics
Three levels of metrics Quality

Benchmarki
Quantity
Levels of HR Metrics ng

HR Metrics
1. Strategic (revenues and revenue
rations), HR operations (HR metrics)
leading indicators Satisfaction Time
Assess the link between HR measure efficiency and (leadership/engagement surveys,
programs and services with goals effectiveness of programs in the learning development)
of organization in the long term shot term
typically forecasted
Money

The HR scorecard, first published about by Becker, Huselid & Ulrich in their 2001 book What are HR Dashboards?
used to identify improvement and process opportunities, reporting tools, can be quarterly, monthly or annually,
Measures the HR function's effectiveness and efficiency in producing employee behaviors management representation by gender
needed to achieve the company's strategic goals. distribution of performance ratings (needs improvement to far exceeds)
1 - strategic perspective turnover by department (years of service)
2 - operations perspective recruiting time to fill (average days openings last)
3 - customer perspective HR Analytics
4 - financial perspective An evidence-based approach for making better decisions about employees and HR policies, using a variety of tools to report HR
The HR scorecard is meant to measure leading HR indicators of business performance. Leading indicators metrics and to predict outcomes of HR programs
are measurements that predict future business growth. These are called HR deliverables. They are also Difference between analytics and metrics : Analytics examines relationship behind numbers and metrics is reporting data
known as HR metrics, and more specifically HR KPIs, as they are metrics that are linked to the business Data Mining
strategy. Data mining is an inductive approach to data analytics. It involves efforts to identify patterns and trends within large datasets. May
also use correlations and multiple regressions
There are five steps to create an HR scorecard: HR Efficiency
Create an HR strategy map
Capacity to conduct HRM processes accurately and on time while minimizing costs. How well HR accomplishes processes
Identify HR deliverables
Creation of HR policies, processes, and practices HR Effectiveness
Aligning HR systems Outcome or impact of an HR program. Metrics that measure HR effectiveness include productivity, customer satisfaction
Creating HR efficiencies
 Important HR Metrics Employee turnover.

Revenue per employee.

Yield Ratios divide that company's total revenue for the year by the number of employees that you have. You
Can be used to indicate the percentage of applicants that proceed to the next stage of the selection process can also use this metric for individual departments.

Selection Ratios Billable hours per employee.

Shows the proportion of applicants for one or more positions who are hired or the number of hired employees This metric may not be applicable to every business, but it is usually relevant for businesses that
to the number of applicants offer a professional service like marketing agencies or legal firms. Not every employee will log hours
that are directly billable to a client, so employees should track their time to allow you to gauge this
Base Rate on an individual basis. Essentially, the more billable hours per employee you have, the more
Shows the proportion of all applicants who would have been successfully hired if hired (how many top revenue the company is making.
candidates)
Absenteeism.
Movement statistics
Absenteeism is the amount of time that your employees are absent from work for any reason
Measures that show the overall movement of employees around the organization as a percentage of overall (vacation, sick days, other). Metrics for absenteeism are given as a percentage of the total amount
workforce
of available working days.

Cost of HR per employee.

Development process of Balance Scorecard
Hiring, training and managing your workforce costs money.
If you look at your HR expenditures for the previous month or year and then
factor in the number of employees on your payroll, you can determine how
much each employee costs on average for HR. [Link] goals,
action plans,
This will allow you to make adjustments and lower costs. 4. Choose
and initiatives
indicators to
measure and
Employee engagement. [Link]
the critical monitor
performance
success factors
Employee engagement is one of the most difficult metrics to obtain because [Link] the
strategic
it cannot be found using your financial records. objectives

You can issue company-wide surveys to your employees and ask questions [Link]
a clear
rated one to five about their experience working in the company. The results vision of
can be averaged to rate your level of employee engagement. the future
Introduction- Knowledge Management Definition
Knowledge Management (KM) is the process of generating, accumulating,
sharing and using knowledge for improving organisational performance.
Peter Drucker
KM is a bad term because knowledge cannot be managed. You should create
It is creation of new skills, capabilities, competencies and sharing the use of this conditions for the generation and application of knowledge, which means
knowledge by organisational members
it is a process of creating an interactive learning environment where people
transfer and share what they know, internalize it and apply it to create new General Definition
knowledge. Knowledge management is the systematic management of an organization's
knowledge assets for the purpose of creating value and meeting tactical &
Knowledge Management is an organizational function that concerns itself with strategic requirements; it consists of the initiatives, processes, strategies, and
the capture, storage, and dissemination of the knowledge that is inherent in systems that sustain and enhance the storage, assessment, sharing, refinement,
the organization by using software or a Processual tool to capture, store, and and creation of knowledge
disseminate knowledge

Process of Knowledge Management

Knowledge Activities 1. Identification of Knowledge Needs

Knowledge management (KM) cannot be achieved with a single definite activity. It involves an
assortment of activities. These are usually referred to be knowledge activities. The utilization of the
knowledge activities at the resources connected to knowledge which is limited and assisted through 2. Identification of Data Sources
an extensive choice of aspects will result in KM.
Research studies do indicate a number of knowledge activities which are important. Some of them
are as below:
3. Acquisition/Generation of Knowledge
Knowledge Acquisition
Knowledge Utilization
Knowledge Selection 4. Processing, Analysing, Presenting and Codifying
Knowledge Transfer
Knowledge Creation
5. Storing
Knowledge Internalization

6. Policy and System

 1. Identification of 2. Identification of Data 3. Acquisition/Generation 4. Processing, Analysing,
Knowledge Needs Sources of Knowledge 5. Storing 6. Policy and System
Presenting and Codifying
The important first step in Once the data needs are It may include acquisition The data/information/ There must be a proper That is the organisation
knowledge management identified, the next step is of books and other knowledge system for storing the shall establish the
is the identification of the identification of sources publications or other acquired/generated need knowledge so that they are appropriate system
knowledge requirements of data for generating the available materials, to be properly processed, available at the right time integrating the various
of the organisation. required knowledge. sourcing from internet, analysed, interpreted and to the right people. components and suitable
The knowledge Data/knowledge may be etc. presented meaningfully technologies and methods.
and usefully. The organisation shall also
requirements may vary readily available Collection of primary data
from organisation to somewhere. or generation of entirely They should also be have an appropriate policy
organisation, depending new knowledge may be systematically classified for regarding knowledge
If they are not readily easy identification for management, including a
on factors like the nature available, primary data done in-house or may be
and scope of its business, outsourced. Outsourcing accessing any time policy in respect of
will have to be gathered accessing information,
competitive and other and the sources of such even R&D is common
sharing/disseminating
business environments, primary data have to be today. knowledge, protecting its
future plans, etc. identified. knowledge base, etc.

Types of Knowledge Description Types of Knowledge Description

Posteriori Knowledge Knowlegde that we get directly from our own experience Tacit Knowledge Tacit knowledge is knowledge that you have but cannot express ex. Emotional
intelligence
Some types of knowledge are not experiential. Theoretical, abstract and
mathematical knowledge, for example, are derived from abstract or logical Explicit Knowledge It is knowledge that can be easily explained to outsiders, Ex. Guides and manual
reasoning rather than direct observation.
Meta Knowledge Metaknowledge is knowledge about knowledge. Anything we know about knowledge
A Priori Knowledge It is knowledge and facts that exist without the need to experience it. You can (such as how it works, how to classify it, how we lose it, how to gain it)
come to your conclusions through reason alone. Imperative (or Procedural)
Knowledge effectively.
Dispersed Knowledge/ Dispersed knowledge is knowledge that no single person has Complete knowledge.
Distributed Knowledge The knowledge is dispersed or spread out among many different people. Need to Descriptive Knowledge
work in team
through memorization and does not require significant practical experience in the field
Domain (Expert) Domain knowledge is deep knowledge about a particular domain or discipline. Situated Knowledge Situated knowledge is knowledge that emerges out of a specific context, community or
Knowledge culture is hard to understand from outside of that perspective. Ex. Culture
Empirical Knowledge Empirical knowledge is knowledge obtained through the senses. It is distinct from Known Unknowns known unknowns
A Posteriori knowledge because empirical knowledge must be experienced know or understand. Known unknowns are usually within our grasp of understanding
through the senses alone. because we are aware of what we need to learn and can seek out answers. Ex. Confusion

Encoded Knowledge knowledge that has been recorded in symbolic codes. Ex. Written language, road Unknown Unknowns
signs have it.
 Externalization: Tacit to Combination: Explicit to Internalization: Explicit to

The SECI Model and Knowledge Conversion -

Socialization: Tacit to tacit
explicit. explicit. tacit.
Knowledge is passed on This is deemed as a This is the simplest form. As explicit sources are

Ikujiro Nonaka- Takeuchi 1996 through practice,

guidance, imitation, and
observation
particularly difficult and
often particularly
important conversion
Codified knowledge
sources (e.g. documents)
are combined to create
used and learned, the
knowledge is
internalized, modifying
Nonaka and Takeuchi introduced the SECI model (Nonaka & Takeuchi 1996) which has mechanism. new knowledge. the user's existing tacit
Tacit knowledge is knowledge.
become the cornerstone of knowledge creation and transfer theory.
codified into documents,
They proposed four ways that knowledge types can be combined and converted, manuals, etc. so that it
can spread more easily
showing how knowledge is shared and created in the organization. through the organization.
Since tacit knowledge
1. Socialization: Tacit to tacit can be virtually
impossible to codify, the
2. Externalization: Tacit to explicit extent of this knowledge
conversion mechanism is
3. Combination: Explicit to explicit. debatable.
4. Internalization: Explicit to tacit. The use of metaphor is
cited as an important
externalization
The model is based on the two types of knowledge explicit knowledge and tacit mechanism
knowledge.

The Wiig Model for Building and Using Knowledge The Wiig Model for Building and Using Knowledge
Karl Wiig KM model (1993) highlights the following principle: Organizing knowledge in a repository for Wiig defined 4 types of knowledge
users so that different users can acquire the right knowledge for their right problems from well-
developed repository. 1. factual knowledge,
According to Wiig there are 3 scopes of knowledge : public knowledge, shared expertise, personal
knowledge 2. conceptual knowledge,
Knowledge should be organized differently depending on what the knowledge will be used for. Some 3. expectational knowledge :Knowledge that instead of deriving from data or information,
useful dimensions in the Wiigs KM model are: comes from expectations, judgments, beliefs, working hypotheses, and associations, based
1. Completeness: refers to how much relevant knowledge on previous experiences.
2. Connectedness: refers to the well-understood and well-defined relations between the different 4. methodological knowledge.
knowledge objects
3. Congruency: when all the facts, concepts, perspectives, values, judgments, and relational links
between the objects are consistent
4. perspective and purpose: is a phenomena through which we know something but from a
particular point of view for a specific purpose
 Knowledge Map Introduction Executive Development
A knowledge map is a visual aid that shows where knowledge can be found within a group or 1. Executive development is the whole of activities aimed at developing the skills and
organization, and how to find those with the most expertise. competencies of those that (will) have executive positions in organisations.
interconnected nodes to make it easy to find out where to look for information. 2. While "executive" and "manager" and "leader" are often used interchangeably,
Knowledge Mapping: Is a tool used by organizations to find quickly, cost-effective, and up- "executive" is commonly used to signify the top 5% to 10% of the organization.
dated knowledge of their employees represented under different forms (graphs, tables,
databases, indexes, or matrix) in order to help them improve processes like recruitment, 3. Executive development or management development is a systematic and continuous
employment, promotion, learning and development process through which the executives learn advanced knowledge and skills in managing.
It is a process by which organisations can identify and categorise knowledge assets within their 4. Executive Development Programme (EDP) is a planned and organised process of learning
organisation - people, processes, content, and technology. and growth designed to improve managerial behaviour and performance of executives by
cultivating their mental abilities and inherent qualities through the acquisition and
application of advanced knowledge insights and skills.

Definition Characteristics of Executive Development

Michael Armstrong, 1. to handle high-level responsibilities.
eventually something that the executive 2. It is continuous, ongoing activity as it aims improving total personality, behaviour,
has to attain himself. attitude of managers which cannot be done overnight.
But he will do this much better if he is given encouragement, guidance 3. It is a long-term process, as managers take time to acquire and improve their capabilities.
4. It is proactive in nature as it focuses attention on the present as well as future
Koontz and O Donnell requirements of both the organisation and the individuals.
5. Involves Stresses and Strains Development does not takes place in the total peaceful
and relaxed atmosphere. It involves stresses and strains.
cultivates those skills whose application will improve the efficiency
and effectiveness with which the anticipated results of a particular 6. Guided Self Development Executive development can only be made possible only
when the manager himself wants to learn. The individual must have the desire to learn and
organisational segment are achieved practice what he is taught.
Executive Development 10 Main Principles or Guidelines Observed by the
Management towards Executive Development Executive Development Process
1. It is the responsibility of the management to arrange for executive development, which should be kept in charge of a senior executive.
2. Every departmental manager should take the responsibility of developing his subordinate extinctive.
3. Executive development programme should aim at meeting the needs of the individual executive as well as the needs of the enterprise.
1. Identifying 2. Appraisal of 4. Inventory of
4. The pre-requisite of effective executive development is the selection of the right man for the executive position. 3. Defining
Development Current Pool of Executives
5. The management should formulate a definite strategy of executive development specifying clearly the various objectives, coverage and Parameters
type of development.
Programme Management Manpower
6. The management should prepare a realistic time schedule for the executive development programme keeping in view the present and
future needs of the organisation.
7. The executive development programme should be made applicable to each and every executive so as to avoid executive obsolescence
and impart latest knowledge and skills to all the executives. 5. Developing
8. The management should create congenial and favourable climate conducive to executive development. 7. Programme 6. Conducting Executive
9. The participation of executives in every development programme should be made mandatory. Evaluation Development Development
10. The management should arrange for feedback to its trainee executives so as to enable them to take necessary steps to improve
Programmes
themselves.

2. Appraisal of Current Pool of

1. Identifying Development Programmes 4. Inventory of Executives 5. Developing Executive
Management Talent 3. Defining Parameters
Manpower Development Programmes
An organization has to critically examine The performance appraisal of present Parameters for Inventory of executive s This programmes should be
the organization s developmental executives shows the respective development needs to be age, education, tailored to address the
needs, present as well as future. Then, performance of each executive in the identified in the light of experience, health record, deficiency of executives.
it should decide on what types of current position. overall developmental psychological test result The individual differences
managers/executives are needed to This discloses the strength and weakness needs. and performance appraisal like age, physique,
achieve such needs. of the existing executives. These parameters need to data has to be prepared. emotional intelligence,
It can prepare job description and job Besides, the organization should conduct be defined in terms of An analysis of the inventory intelligence quotients, etc.,
specification a potential appraisal either formally or various skills required at discloses the strength and should be factored in
different levels of the weakness of executives in designing the programme.
Compare the existing pool of talent through feedback provided by superiors, career for a manager certain functions relative to
available in-house as well as the peers and the HR department. the future needs of the
strength of potential employees who Thus both the current as well as organization.
can be nurtured with the total talent potential appraisal indicates the type of This step gives vital input
needed to meet the projected needs of development exposure needed for an for developing programmes
the organization executive for executives.
 6. Conducting Development
7. Programme Evaluation
Programmes
The organization has to choose Since the management
appropriate programmes like programme involves investment
leadership courses, soft-skill of money, time and energy
development, sensitivity resources, top management
training, team building, intends to measure the impact
problem-solving, management of the programme.
games and so on to address the The pre and post programme
needs of the executives relative survey would help in measuring
to the current and future needs its effectiveness and on deciding
of the organization. the continuity of various
programmes

(a) Top Management (b) Middle Line Management (c) Middle Functional Executives and Specialists

Objectives of Executive Development 1. To improve thought

processes and analytical ability
1. To establish a clear picture of
executive functions and
1. To increase knowledge of
business fractions and
in order to uncover and examine responsibilities; operations in specific fields in
1. Improve the performance of managers at all levels. problems and take decisions in 2. To bring about an awareness marketing production, finance,
the best interests of the country of the broad aspects of personnel;
2. Identify the persons in the organisation with the required potential and prepare them for higher and organisation; management problems, and an 2. To increase proficiency in
positions in future. 2. To broaden the outlook of acquaintance with and management techniques such
the executive in regard to his appreciation of as work study, inventory
3. Ensure availability of required number of executives / managers succession who can take over in role, position and interdepartmental relations. control, operations research,
case of contingencies as and when these arise in future. responsibilities in the quality control;
3. To develop the ability to
4. Prevent obsolescence of executives by exposing them to the latest concepts and techniques in their organisation and outside; analyse problems and to take 3. To stimulate creative thinking
respective areas of specialisation. 3. To think through problems appropriate action; in order to improve methods
this may confront die 4. To develop familiarity with and procedures;
5. Replace elderly executives who have risen from the ranks by highly competent and academically organisation now or in the the managerial use of financial 4. To understand the functions
qualified professionals. future; accounting, psychology, performed in a company;
4. To understand economic, business statistics; 5. To understand industrial
6. Improve the thought processes and analytical abilities. technical and institutional forces 5. To Inculcate knowledge of relations problems; and
in order to solve business prob- human motivation and human 6. To develop the ability to
7. Provide opportunities to executives to fulfill their career aspirations.
lems; and relationships; and analyse
8. Understand the problems of human relations and improve human relation skills. 5. To acquire knowledge about 6. To develop responsible or functions.
the problems of human leadership.
relations.
Methods of On the Job Techniques [Link]
Executive [Link] study Method
Development 3Job Rotation
[Link] Project Assignment
[Link] assignment
6. Multiple Management
7. Selective Reading

Off the Job Techniques 1. Special Courses

[Link] Studies
3. Role Playing
4. Lectures and Conferences
5. Syndicate Method
6. management Games
7. Brainstorming

(i) Coaching Advantages Disadvantages

On Job Techniques The Immediate superior

guides and instructs his
(a) It is the process of
learning by doing.
(a) It requires that the
superior should be a
subordinates as a coach. (b) Even if no executive good teacher and the
1. On the job development of the managerial personnel is the most common The immediate superior development programme guide.
form which involves learning while performing the work. briefs the trainees what exists, the executives can (b) Training atmosphere
2. On the job techniques are most useful when the objective is to improve is expected from them coach their subordinates. is not free from the
on the job behaviour of the executives. and guides them how to (c) Coaching facilitates problems and worries of
effectively achieve them. periodic feedback and the daily routine.
3. This type of training is inexpensive and also less time consuming. The coach or immediate evaluation. (c) Trainee may not get
4. The trainee without artificial support can size up his subordinates and superior watches the (d) Coaching is very sufficient time for making
performance of their useful for developing mistakes and learn from
demonstrate his leadership qualities.
trainees and directs them operative skill and for the the experience.
in correcting their orientation of the new
mistakes. executives.
 (ii) Under Study Advantages Disadvantages (iii) Job Rotation Advantages Disadvantages

The person who is (a) Continuous guidance is (a) The existing managerial Job rotation is a method (a) By providing variety in (a) Disturbance in
designated as the heir received by the trainee practices are perpetuated of development which work this method helps in established operations is
apparent is known as an from his superior and gets in this method. involves the movement of reducing the monotony caused due to the job
understudy. the opportunity to see the the manager from one and the boredom. rotation.
(b) The motivation of the
total job. position to another on (b) Inter departmental (b) It becomes difficult for
In this method the trainee personnel is affected as
the planned basis. coordination and the trainee executive to
is prepared for performing (b) It is a time saving and a one subordinate is
the work or filling the practical process. selected for the higher This movement from one cooperation is enhanced adjust himself to frequent
position of his superior. position in advance. job to another is done through this method. moves.
(c) The superior and the
according to the rotation (c) By developing (c) Job rotation may
Therefore a fully trained subordinate come close to (c) The subordinate staff
schedule. themselves into demotivate intelligent
person becomes capable each other. may ignore the under
to replace his superior study. It is also called position generalists, executives get and aggressive trainees
(d) Continuity is
during his long absence, rotation a chance to move up to who seek specific
maintained when superior
illness, retirement, higher positions. responsibility in their
leaves his position.
transfer, promotion, or chosen responsibility.
death. are best utilized.

(v) Committee Assignment (vi) Multiple Management (vii) Selective Readings

(iv) Special Projects Assignment Advantages
In this method the special Charles P McCormick had Under this method the
In this method a trainee is assigned a (a) The trainees learn the work committee is constituted and is developed the multiple executives read the journal,
project which is closely related to his job. procedures and techniques of budgeting. assigned the problem to discuss management technique of books, article, magazines, and
and to provide the management development notes and exchange the news
Further sometimes the number of (b) The trainees come to know the recommendations. programme with others.
trainee executives is provided with the relationship between the accounts and This method is similar to the This method involves the This is done under the planned
project assignment which is related to other departments. special project assignment. constitution of the junior board reading programmes organized
All the trainees participate in the of the young executives. by some companies. Reading of
their functional area. (c) It is a flexible training device due to deliberations of the committee. This junior board evaluates the the current management
This group of trainees is called the temporary nature of assignments Trainees get acquainted with major problems and makes the literature helps to avoid
project team. different viewpoints and recommendations to the Board obsolescence.
alternative methods of problem of Directors. This method keeps the manager
The trainee studies the assigned solving through the deliberations The junior board learns the updated with the new
problem and formulates the and discussions in the decision making skills and the developments in the field.
recommendations on it. committee. Interpersonal skills vacancies in the Board of
of the trainees are also Directors are filled from the
These recommendations are submitted developed. members of the junior board
in the written form by the trainee to his who have sufficient exposure to
superior. the problem solving.
 (i) Special Courses (ii) Case Studies
(iii) Role Playing (iv) Lectures and Conferences
Under this method the executives attend This method was developed by Harvard
the special courses organized by the Law professor Christopher C. Langdell. In role playing the conflicting situation is In this method the efforts are made to
organisation with the help of the experts created and two or more trainees are expose the participants to concepts, basic
In this method a problem or case is assigned different roles to play on the principles, and theories in any particular
from the education field. presented in writing to a group i.e. a real spot. area.
The employers also sponsor their or hypothetical problem demanding
executives to attend the courses solution is presented in writing to the Management trainees would have an Lecture method emphasizes on the one
organized by the management institutes. trainees. opportunity to role play both the way communication and conference
manager and the subordinate role, in method emphasizes on two way
This method is becoming more popular Trainees are required to analyze and study order to better understand some of the communication.
these days but it is more used by the large the problem, evaluate and suggest the dynamics of this situation, as well as
and big corporate organisations. alternative courses of action and choose Through this method the trainee actively
practise interpersonal skills participates and his interest is maintaine
the most appropriate solution.
This technique is generally used for human
Analytic, problem-solving and critical relations and the leadership training.
thinking skills are most important
This method is used as a supplement to
Team problem-solving and interaction are other methods
possible

(v) Syndicate Method Behaviour Modelling

(vi) Management Games (vii) Brainstorming
Syndicate refers to the group of trainees and Behaviour modelling seeks to improve
involves the analysis of the problem by interpersonal skills among the trainees. The It is a technique to stimulate idea
different groups. alternative expressions used for this model A development technique in which teams generation for decision making.
Thus in this method, 5 or 6 groups consisting of include interaction management or imitating of managers compete by making Brainstorming is concerned with using the
10 members are formed. Each group works on model. brain for storming the problem.
computerized decisions regarding realistic
the problem on the basis of the briefs and the The key to behviour modelling is learning
backgrounds provided by the resource persons. through observation or imagination, and is
but simulated situations. It is a conference techniques by which
Each group presents their view on the involved modelled on social learning theory group of people attempt to find the
issues along with the other groups. communication skills, helps them to solution for a specific problem by amazing
After the presentation these views are better manage the information flow all the ideas spontaneously contributed by
evaluated by the resource persons along with between individuals and the team, and the members of the group. In this
the group members. improves planning and problem-solving technique the group of 10 to 15 members
Such exercise is repeated to help the members skills is constituted.
to look into the right perspective of the The members are expected to put their
problem. This method helps in the ideas for problem solution without taking
development of the analytical and the
interpersonal skills of the managers into consideration any type of limitations
1. Action learning : A training technique by which management trainees are allowed to work full-
time analyzing and solving problems in other departments. Secondments: A secondment involves an employee usually a manager
spending a period of time working in a different organisation (e.g. supplier
2. University-related Programs : Many universities provide executive education in leadership, or customer). The period needs to be atleast one year, the secondment is
supervision, and the like. These can range from 1- to 4-day programs to executive development monitored effectively and evaluated at the end.
programs lasting 1 to 4 months

3. In-house development center : (often called corporate universities) A company-based method Personal Development Plans (PDPs) In these, employees write their own
for exposing prospective managers to realistic exercises to develop improved management personal development plans. Such development plans include
skills. development needs and action plans to achieve them. A PDP could be the
nucleus of a wider career plan such as setting out alternative long-term
4. Executive coach: An outside consultant who questions the executive s associates in order to
identify the executive s strengths and weaknesses, and then counsels the executive so he or she -term needs and setting out a plan of self-
can capitalize on those strengths and overcome the weaknesses. development

5. Stretch Assignments Stretch assignments are assignments that push employees beyond their
comfort zone, placing them in jobs and assignments different from and more demanding than
those to which they are accustomed.150 The critical issue here is to understand the employee s
capabilities: The assignment should be challenging but not overwhelming

1. Expert of Provision Mode

What is a Consultation?
1. Consultation is a process between two professional persons, the
consultant who is a specialist, and the consulate who invokes Doctor-Patient or Prescription Model
the consultants help in regard to current work problems
2. Consultation is "a voluntary relationship between a professional 5 Conceptual Models Mediation Model
helper and help-needing individual, group, or social unit in
which the consultant is providing help to the client(s) in defining
and solving a work-related problem or potential problem with a Process Consultation or Collaboration Model
client or client systems"
.
Feminist or Multicultural Model
 Expert or Provision Model Doctor Patient or Prescription Model Process Consultation or
Mediation Model Feminist or Multicultural Model
Collaboration Model
Consultant provides a direct service to Consultants advise consultees about what is (Mediator= one person - Consultants are facilitators of - Consultation non-hierarchal
consultee who does not have the time, wrong with the third party. coordinates the process) the problem-solving process (consultant is not the expert)
inclination or skills to deal with a problem -* Consultants act as they facilitate a group of people - Consultant is the agent of
coordinators in solving the problem change
Advantage: experts can handle difficult Consultants tell what should be done about - Main function is to combine - Main task is to get consultees - culturally responsive and
problems and leave consultees free to do a problem the services of a variety of actively involved in finding empowering to consultees
other things without work conflicts people who are trying to solve solutions to the problem Ex: consulting on cultural issues
Works well in situations where consultees a problem. existing with the client to further inform counselling
Disadvantage: consultants are blamed if lack confidence in their own intervention Goals accomplished by: - For instance, this is the practices or client assessment
- Coordinating the services solution-based focus of IEPS
problem does not get better strategies already being provided used in schools to bring
- Creating alternative/ other together all teacher and
Ex: if someone is giving expert consultation Consultants do not have to make a change or plans of services that represent administrator concerns for a
on a major issue and this issue gets called to cure. mutually accepted solutions child to focus on a solution in
court, then the consultant gets involved and - For instance, coordinating the each situation.
different services received by a
is asked their opinion at court. Ex: going to the doctor and getting a handicapped child in a school
consultation on what's wrong with you, then - Very common in schools- case
you find out from the doctor, and the doctor conferences seen in many
is done their job. schools

Individual Consultation
3 Most Common Role-reversal process= when the consultant plays the role of the consultee and the
consultee plays the role of the client. The consultant will ask the "client" (really the
Ways to Implement consultee) about the payoffs and risks of the ideas for change.
the Consultation
Process Mutual trust and respect are essential

Teaching negative thinking can decrease anxiety.

Organization/ Ex: "the worst thing that can happen is....". If you the possibility of negative things
Individual occurring, then it will decrease anxiety for if it actually occurs.
Group Consultation Community
consultation
Consultation Consultant may model a skill or prescribe a solution
- Ex: executive coaching- if one wants to increase their skills and training then they
can go to an executive coach to help them with skills, professional processes and the
coach would help you find gaps or places where you can achieve your goal
 Group Consultation
Organization/ Community Consultation
Used when several consultees share a similar problem, such as in a work setting.
Ex: in workplaces there can be issues of harassment, bullying, so it's in the work - The consultants are external to the project (they are not bias)
places best interest to get consultation to turn the work place around. Environmental mapping- individuals in the organization/community can be
When problem solving in groups, the consultant acts as a catalyst and facilitator targeted by the consultant to improve the situation of the population
When used in person-focused groups, the consultant helps group members build Consultants encourage the consultee to change stress-producing
teams to understand and resolve person problems environments. often times its stressors in the work place which causes
This is one of the first effective collaboration consultation models productivity to go down which makes the workplace lose money. Once the
Primary purpose is to present new knowledge about human behaviour to the consultant points out stressors, the workplace can change them in order to
group. improve.
All aspects of approach being with C: collaboration, consultation, clarification, Works better to change the structure of the system rather than the person
confrontation. within it
Participants not only become better educated and self-directed, but also continue - Ex: addressing the overall structure and operations of a company or
to live in an environment where they can receive support and input from others community to change it for the better
who have gone through similar experience

Splete's Nine-Stage Process : Stages and Attitudes in Consultation: Five Stage Consultation with Counsellor Techniques and Behaviours
These five stages differ with Splete's 9 stages as these have counsellor techniques and
Splete's process is based on the premise that clients (consultees) work with the
consultants on predetermined concerns.
behaviours. Incorporates counselling micro skills and how counsellors deal with clients.
(In these 5 stages, the consultant uses counsellor-like skills and techniques in order to
Nine-Stage achieve their goal).
1. Pre-contract- consultant clarifies personal skills and expertise that can be used in the Stages (Dustin and Ehly's 5 Stage)
process. (Saying what your skills are to "impress" the client so they will want to use you).
2. Contract and exploration of relationship- consultee's readiness and consultant's ability 1. Phasing in- consultant uses active listening, self-disclosure and empathy to build trust
to respond are determined. (Consultee getting ready to sign and consultants ability to 2. Problem identification- determine if a third-party problem exists. Consultant uses
respond and tell the consultee what they want to hear). focusing skills, paraphrasing, restatement, genuineness and goal setting
3. Contracting- a mutual agreement is determined defining services (contract is now 3. Implementation- defines strategies and sets up a time frame. Consultant implements
signed) their skills by giving feedback, being flexible, dealing with resistance, negative feelings and
4. Problem identification- problem and outcome are defined. being patient.
5. Problem analysis- reviewing the problem and coming up with solutions.
6. Feedback and planning 4. Follow-up and evaluation- consultants their following skills: risk taking, openness and
7. Implementation of the plan persistent
8. Evaluation of the plan 5. Termination- consultant brings closure, uses relationships such as empathy and genuine
9. Conclusion and termination of relationship and gives and asks for feedback.
 Sub System of HRIS
HRIS (human resource information system) 1. Recruitment Information : It includes the placement data bank advertisement module, general requirement and training
requirement data.
1. Human resource information system (HRIS) can be defined as a software or online 2. Personnel Information: It includes employee information such as transfer monitoring and increment and promotion details
solution that is used for data entry, data tracking, and the data management of all 3. Manpower Planning Information : It seeks to provide information that could assist human resource mobilization, career
human resources operations of an organization. planning, succession planning and input for skill development

2. Human resource information systems are software programs that allow HR 4. Training Information: It provides information for designing course material, arrange for need base training and cost analysis
professionals to store and organize vast amounts of employee information. These of training etc
programs should allow management to access information and improve decision 5. Health Information System : This subsystem provides information for maintenance of health related activities of the
making. employees.

3. it includes all aspects of managing the employee database and directory, applicant 6. Appraisal Information : It deals with the performance appraisal and merit rating information which serves as input for

tracking, benefits administration, payroll processes, work scheduling, time and promotion, increment and secession and career planning etc.
attendance, leaves tracking, electronic signatures, compliance protocols, 7. Payroll System: It consists of information concerning wages, salaries incentives, allowance, perquisite deduction for
customizable insight reports, employee self-service, performance management, and provident fund etc. Data on compensation pattern of competitor is also included in it.
HR processes taken care of on mobile apps. 8. Personnel Statistics System : It is a bank of historic and current data used for various type of analyst.

4.

STEPS IN IMPLEMENTING AN HRIS

A sound HRIS can offer the following advantages
1. Clear definitions of goal.
[Link] of Idea [Link] the System 2. Reduction in the amount and cost of stored human resource data.
[Link] Study [Link] the Data 3. Availability of timely and accurate information about human assets.
[Link] a Project [Link] the System 4. Development of performance standard for the human resource division
5. More meaningful career planning and counselling at all levels.
[Link] the Requirements [Link] Up
6. Individual development through linkage between performance reward and job training.
[Link] Analysis [Link] in Parallel
7. High capability to quickly and effectively solve problems.
[Link] Contract Negotiation [Link] 8. Implementation of training programmes based on knowledge of organizational needs.
[Link] [Link] 9. Ability to respond to ever changing statutory and other environment
10. Status for the human resource functions due to its capability for strategic planning with the total
organization
 Benefits of Human Resource Information Systems Detailed course on HRM/OB/IR
(HRIS) International HRM
1. Become strategic partners with top management NTA UGC NET/JRF 2021
2. Be more efficient and provide better information for decision making Industrial Relations and Labour welfare/HRM
3. Increased use of web technology will leave HR for more time for strategic planning CODE 55
Paper 2
4. Enables employees to focus on their adminstration work
5. Strategic Architecture enables HR professionals to act as competent manager in arranging
Presented by
people to their respective positions
Lakshmi Kushwaha
Contribute to overall business performance by: Follow me : [Link]/@lakshmikushwaha12-6214
Supporting task of data storage and retrieval
Rate, Review, Feedback, Share
Serving as primary admin support tools
Reporting, statistics and program monitoring

Introduction
Introduction
1. International Human Resource Management (IHRM) can be defined as a set of 1. The purpose of international human resource management is to get the
activities targeting human resource management at the international level. competitive advantage by hiring and improving the skills, efficiency, and
productivity through the process of procuring, allocating, assigning, providing
2. It strives to meet organizational objectives and achieve competitive advantage over training & development, performance appraisal, compensating for the
competitors at national and international level. effective utilization of human resources in the global environment
3. Globalization and the growth of information technology and the advancements in 2. International human resource management bears both functional and strategic
modern business make the world to create and adopt new methods and concepts of resemblance to human resource management.
human resource management in the form of international human resource
management (IHRM). 3. International human resource management differs from domestic human
resource management primarily in terms of the complexity associated with
managing people across national boundaries.
 Pulapa Subba Rao
Definition International human resource management as, performing HRM and
its related activities and arranging for related and necessary
Boxall, P. (1992) immigration facilities for prospective and current expatriate
employees, by organizations operating in domestic and/or foreign
International Human Resource Management (IHRM) as countries.
concerned with the human resource problems of
multinational firms in foreign subsidiaries (such as
Edwin B. Flippo,
expatriate management) International or domestic HRM involves the planning, organizing,
with the unfolding HRM issues that are associated with directing and controlling of the procurement, development,
the various stages of the internationalisation process compensation, integration and maintenance of people for the

Mark Mendenhall (2000) Hugh Scullion

IHRM is concerned with HRM issues that cross national International HRM (IHRM) involves the HRM issues and
boundaries or are conducted in locations other than the problems arising from the internationalisation of business,
home country headquarters. and the HRM strategies, policies and practices which firms
IHRM is concerned with the relationships between the HRM pursue in response to the internationalisation of business.
activities of organisations and the foreign environments in
which the organisations operate. General Definition
HRM includes comparative HRM studies; e.g. differences in the
how companies in Japan, Thailand, Austria and Switzerland process of procuring, allocating, and effectively utilizing
plan for upgrading of employee skills and so on.
 Objectives of International HRM Categorization of countries in the concept of IHRM

1. It enhances to develop managerial skills, organisational knowledge and technical

abilities of HR managers and employees; Countries
2. To develop more and better handle of global business operations;
3. To manage and secure the performance, compensation and career path of employees;
the countries having headquarters and
4. To manage and organise cross cultural counselling and language training programme; subsidiaries are categorized as follows.
5. To develop more feasible understanding of work practices at global levels;
6. To raise and develop better and new performance management of human resources; Home country Third/other countries
Host country
7. To get more and more opportunities within global HR scenario; Where the headquarters is These are the sources of finance
Where the subsidiary is located
located and human resources
8. To develop better and competitive HR strategies in global competitive scenario;
[Link] reduce the cultural differences as amicable for cultural environment.

3 Types of Employee 3 broad Activities of IHRM

Parent-Country Host-Country Third-Country
Nationals (PCNs) Nationals (HCNs) Nationals (TCNs)
Employees
belonging to the
Employees
belonging to
Employees who
work in the home
IHRM
country where a country where the or host country
company has set facility of the
headquarters are up a subsidiary or company but are
located are called a manufacturing not nationals of Allocating Effective Utilizing
Procuring
as parent-country facility are called either are called the plan for using human helps in maximizing the skills
Planning and Induction resources among various and efficiency of the human
nationals or home host- country third- country subsidiaries or projects resources and productivity.
country nationals nationals. nationals.
 Staffing Approaches
HRM activities in IHRM Staffing
IHRM covet all the six activities of domestics HRM i.e. Approaches
1. HR planning,
2. Employees Hiring,
Depending on the
3. Training and Development, recruitment of key
managerial positions
4. Remuneration,
5. Performance Management and
6. Industrial Relations. Ethnocentric
Polycentric
Geocentric Re-Geocentric
Approach(Home approach(right person
Approach(Host Country) Any country
Country) for the right job.)

1. Ethnocentric Approach Advantages Disadvantages

2. Polycentric Approach Advantages Disadvantages
organizations believe that Organization s culture can Need to pay more for the
key managerial positions Host country managers may not always create a
the employees of home be easily adapted to all expatriates
are filled with the can analyze and scope of better
country nationals can the subsidiaries Cross-cultural variations
perform better to fulfill employees of the host understand the local coordination between
Possible to eliminate may lead to clashes, may country nationals markets and local people headquarters and
communication barriers not aware of the local subsidiaries.
mission, vision, and host country nationals can Better coordination with
between the values and beliefs
objectives help in fulfilling the the business environment Quick control of
headquarters and Host country national objectives of the is possible, both internal operations is not possible
All the key managerial subsidiaries employees may get organizations with a and external. because of the key
positions of the Control and monitor the disappointed by losing better understanding of No difficulty arises due to managerial positions are
subsidiary are filled with operations of the the key managerial roles. the local culture, beliefs, cultural issues. occupied by the host
expatriates from the subsidiaries and values. Job Satisfaction and job country nationals.
home country. Better coordination of subsidiary is given enrichment errors may occur in the
activities between the freedom to take decisions fulfillment of the
parent company and less expensive than hiring
and formulate strategies expatriates. standards of organization
subsidiary are possible. according to the local culture.
Local market knowledge
business environment
3. Geocentric approach Advantages Disadvantages

organizations hire competitive advantage by Expensive

neither the home
country nationals nor
hiring most talented and
eligible people.
Chance of cross-cultural Expatriates
clashes become high
the host country creates a scope to hire Difficult to monitor and 1. Expatriates are the employee who are sent to work abroad on a long-term job
nationals control the operations assignment such as employees who need populate a new office or senior
recruit employees on the and skilled employees. spend more on managers who need to manage or set up a new branch.
basis of the concept right helps in reducing the expatriate relocation 2. An expatriate is an employee who has left his native land and is working and
person for the right job. unfair treatments and allowance. temporarily residing in a foreign country. An expatriate can also be a citizen
organizations hire right clashes in the High cross-cultural who has relinquished citizenship in their home country to become the citizen of
persons or suitable organization due to the variations arise. another country.
employees for the favoritism towards
may not always facilitate
effective running of the nationality. 3. Expatriate employees generally receive additional benefits, such as cost of
better coordination
business operations, living and hardship allowances as well as housing or education and sometimes
irrespective of the even paid education for their children.
nationality

Predeparture Training Onsite Consulting Repatriation Training

Expatriate Training also known as cultural

orientation training
provides guidance for expats
in handling business and
reorients expats to their
home country just prior to
introduces expats to the adjustment issues that arise or just after their return.
international assignment during their international to guide expats and family
experience prior to their assignments. members in reflecting on
departure for the host To assist expats in assessing the personal changes they
[Link] consulting country the approaches they use to have experienced
to facilitate facilitate return to to prepare expats to live
handle such issues and to
to prepare them for
adjustment to the home country provide them with guidance
to address and/or work effectively in in determining and changes within their home
living and working another culture, implementing new environment and
specific
in the host to interact appropriately approaches. organization;
intercultural issues
country; with people of that culture, Experienced intercultural
that arise during and
1. Predeparture the assignment
consultants can work with
[Link] to benefit personally from expats
and language
training the international assignment To optimize the overall
training
experience. performance
Help to adjust family
members
 International Compensation
1. International compensation can be defined as the provision of monetary and non-
monetary rewards, including base salary, benefits, perquisites, long- and short-term
incentives, valued by employees in accordance with their relative contributions to MNC
Criteria for selecting expatriates
1.
2. Components: Base salary, incentives,allowances & benefits
management employees can be selected locally.
Objectives
2. Upper management positions can be filled with parent country nationals
1. Attract employees who are qualified , experienced and interested in international
assignments (PNC), host country nationals (HCN) and third-country nationals (TCN).
2. 3. The choice of whom to hire is often influenced by the attitudes of top
subsidiary, and back from subsidiary to home. management teams and the overall staffing policies.
3. Provide a consistent and reasonable relationship between the pay levels of employees at
headquarters, domestic affiliates and foreign subsidiaries 4. The organisations strategic positions and vision should take the view on
4. Be cost effective by reducing unnecessary expenses international human resource management and how it can be integrated into
the organisation.
5. Should be easily understood and easy to administer

234 235

Factors involved in the expatriation selection Types of Allowances Given to Expatriates

Foreign Service Premiums
Individual Factors Work Situation Factors This is a sum of money that is simply a reward for being willing to move one's family to a new
country. The sum is generally a percentage of one's base salary usually between 10 to 25
percent.
Technical Ability Organisation-Specific Hardship Allowance
Cross-Cultural Requirements The hardship allowance is actually another foreign service premium added to the original one. It
Suitability Language is based on not just having to go overseas, but where you go overseas. Hardship allowances are
greatest when the expatriate is sent to places having poor living conditions, a vastly different
Family Requirements MNE requirements culture, less access to good health care, etc.

Cost of Living Allowances

Cost of living allowances (COLAs) enable expatriates to maintain their standard of living
237
Housing Allowances
The cost of housing in various parts of the world is much [Link] allowances
compensate expatriates for these higher costs. Approaches to Expatriate Compensation
Utility Allowances
The home-country-
Some companies give expatriates a fixed sum of money above their base salary to pay their based approach.
utilities bills; other companies try to ascertain the difference in utility bills between the home
and the host countries, and give an allowance based on that difference.
The host-country-
Education Allowances based approach
Most expatriates send their children to private school overseas. Companies often pay the full Approaches
cost of tuition, books, and supplies Global Market
Relocation Allowances Approach
The allowance makes up for any mistakes made in any of the other allowances for
unforeseen complications. Expatriates receive about one month's salary. Local Plus approach
238 239

Home-based policy (The balance sheet approach)

1. Basic objective is maintenance of home-country living standard, plus financial inducement Home-country pay and Host-based policy (Going rate
2.
benefits are the foundations of this approach.
The balance sheet approach provides international employees with an expatriate compensation package that equalizes
cost differences between the international assignment and the same assignment in the home country of the individual
approach/
or the organization. 1. With this approach, the base salary for international transfer is linked to the salary structure in the
3. The balance sheet approach is based on some key assumptions and is designed to protect expatriations from cost host country. It is adopted by companies using the so-called market rate system, which ensures
differences between their home and host countries. that the salaries of expatriates match the market levels of pay in the host country.
According to Reynolds: 2. The multinational usually obtains information from local compensation surveys. and must decide
1. The balance-sheet approach to international compensation is a system designed to equalize the purchasing power of whether local nationals (HCNs), expatriates of the same nationality, or expatriates of all nationalities
employees at comparable position levels living abroad and in the home country, and to provide incentives to offset will be the reference point in terms of benchmarking.
qualitative differences between assignment locations.
2. There are four major categories of outlays incurred by expatriates that are incorporated in the balance sheet approach.
3. Adopting the same compensation for all countries within a particular region.
3. Goods and services: home country outlays for items such as food, personal care, clothing household furnishings, 4. The host-based approach may be a cost-effective option to the traditional home-based approach,
recreation, transportation and medical care. including local plus policy components.
4. Housing: major costs associated with housing in the hose country.
5. With the Going Rate approach, if the location is in a low-pay country, the multinational usually
5. Income taxes: parent-country and host-country income taxes. supplements base pay with additional benefits and payments.
6. Contributes to savings, payments for benefits, pension contributions, investments, education expenses, social
security taxes, and so on.

240 241
 Local Plus approach
1.

2. Benefits may be paid in-kind (directly by the MNE)

3. does not typically include tax equalization, COLA, mobility premiums,
hardship allowances, familiarization visits, home leave, cross-cultural training
and other predeparture programs, or spouse assistance
4. Pension benefits are optional depending on the nature of the assignment
5. Localization involves integrating the assignee into regional or host country
compensation levels and systems to the extent that the law allows.

243

Global Market Approach

2022 July

1. All assignees are on the equivalent compensation scale, regardless of their home
country.
2. This approach is much more inclusive. Regardless of which country the assignee is
assigned, the main benefits are provided.

Budget Approach

1. This system takes in to account all costs incurred by the employee at both the
home and host country. Answer B
2. MNC s will compensate for all the expenses of the expatriate in the home and in
the host country.
3. MNC s will have a control on the spending pattern of the expatriate.

244
 Theories or Approaches of International
Compensation
i. Localisation Approach
ii. Negotiation or Bargaining Approach
iii. Lump sum Approach
iv. Buffet Approach
v. Cluster Systems Approach
vi. Global Approach
vii. Performance based compensation approach
viii. Balance Sheet Approach
Answer : d

Negotiation or Bargaining Approach: Under this approach, MNCs determine compensation packages through
mutual negotiations between the employee and employer. However, this approach will be successful when the Cluster Systems Approach: MNCs categorise countries or cities into clusters based on common factors like
number of expatriates is less and employee and employer both have full knowledge about on-going salary levels cost of living or hardship or danger levels. Company determines more or less same compensation for the
and cost of living in the country of placement. This approach may produce dissatisfaction or feel of inequality jobs within same cluster of cities or countries. This approach reduces the administration costs and also
among host country nationals. enhances the feeling of equality among employees of different countries.

Lump sum Approach: Under this approach, MNC determine the compensation as a lump sum amount which
include basic salary and all kinds of allowances and monetary value of all benefits. Under this approach, Performance based compensation approach: Most recently, MNCs are framing compensation packages
employees have freedom to allocate the money for various kinds of expenditure. based on employees performance. Under this approach, a minimum base salary is guaranteed to meet
basic needs of employees, over and above base salary, employees get the opportunity to earn high salaries
Buffet Approach: Under buffet approach, MNCs provide less cash and more benefits in compensation package. as per their performance irrespective of the nationality. This approach helps in increasing the organisation
Sometimes expatriates also prefer this method to reduce tax liability and save more so as to repatriate the performance and productivity
savings. Employees are given option to decide the cash and benefits component of the compensation package.
This approach, however, increases the administration cost of the company as each employee will prefer different
choices
 Steps In cross Culture Training
Cross Culture Training [Link] Cross-Cultural
Awareness
[Link] Cross-Cultural
Education
[Link] Cross-Cultural
Coaching

1. Cross cultural training refers to the training given to employees related to the This is the need of the hour in For diversified workforce the need coaching or
globalization era employees are provided consultation from experts of
cultural differences between nations, the awareness of which helps in running Should be educated regarding education in the field of that country
smooth business across the nations. own cultural factors which management in different If that is not available timely
affect their own trust, belief, countries then it may become a
2. Cross-cultural training was defined as a procedure or practice used to increase attitude, perception and helps to create awareness bottleneck in cross-border
-cultures and perform well in a new understanding. regarding companies in mergers, acquisitions, FDI,
cultural environment. should be made in a position various countries and and other business activities.
of compare and contrast cultures manage their
3. Cross-cultural training contributes in increasing ability of employees to between the different employees and projects and
understand culture of others, values and ethos of another culture. It develops cultures. business.
the interest to understand employees own background and cultural heritage. For creating awareness knowledge about different
properly the managers should strategies, methods and
have thorough knowledge of management processes
different cultures.

Types of Cross Culture Training

Tung 1982) presented a contingency framework for choosing an appropriate CCT method and its level
[Link] for Dealing Cross-Cultural of rigor.
Challenges She argued for two determining factors:
the degree of interaction required in the host culture and the similarity between the individual's
native culture and the new culture. The culture novelty, implying how different (novel) is the culture of
[Link] for Diversified Workforce the expatriate from that of the host unit
Essentially, Tung proposed:
Types of Cross Culture Training [Link] on Specific Country 1. If the expected interaction between the individual and members of the target or host culture was
low, and the degree of dissimilarity between the individual's native culture and the host culture was
low, then the content of the training should focus on task and job related issues as opposed to
culture related issues, and the level of rigor necessary for effective training should be relatively low.
[Link] in Management Practices
2. If there was a high level of expected interaction with host nationals and a large dissimilarity
between the cultures, then the content of the training should focus on the new culture and on
crosscultural skill development, as well as on the new task, and the level of rigor of such training
[Link] for Conducting Negotiations should be moderate to high.
 Mendenhall and Oddou s Framework
The Mendenhall and Oddou s framework builds on the model provided by Tung. The elements of degree
of interaction and culture novelty are retained, while adding a more complex relationship training
methods It proposes three key elements related to training:
1. Training methods.
2. Low, medium, and high levels of training rigor.
3. Duration of the training relative to degree of interaction and culture novelty
Oddou identified four dimensions that seem to predict success in a foreign posting : Self-orientation,
other-orientation, perceptual ability, and cultural toughness
1. Self-orientation : Attributes that strengthen the expatriate's self-esteem, self-confidence, and mental
well-being.
2. Other-orientation : Enhances the expatriate's ability to interact effectively with host-country nationals.
Two factors relationship development and willingness to communicate.
3. Perceptual ability : Understand why people of other countries behave the way they do, that is, the
ability to empathize. Critical for managing host-country nationals
4. Cultural toughness : Relationship between the country of assignment and how well an expatriate
adjusts to a particular posing. Some countries are much tougher postings than others because their
cultures are more unfamiliar and uncomfortable

steps that an expat experiences as he/she is coping within the new environment:
1. In the first phase, he or she becomes aware of important cultural behaviors;
2. During the second phase, he or she begins to think about what he or she has learned,
seen or heard; and
3. In the third phase, the expat practices the important behaviour.
 Experiential Training
Experiential training is conveyed using a number of methods including, not only, practical exercises,
Cross-Cultural Training Methods workshops and simulations, but also more genuine concepts such as look-see visits to the host
country.
Experiential training aims at preparing the expatriate in a more direct way, building beyond the mere
Didactic Training intellectual experience. The experiential training can also be either culture general or aimed towards
a specific culture.
Didactic training is most often provided in informal briefings, which can be given
in a classical lecture form or with less structured methods such as casual The training is based on the concept of learning by doing and is conveyed by using practical exercises
conversations with experts. It can also be provided with informational booklets,
presenting facts on the host country.
Attribution Training
This type of training provides factual information regarding working and living Attribution training tries to give the expatriate skills in thinking and acting as a host national. It is
conditions as well as cultural aspects of the host country aimed at giving the expatriate an insight into the cultural point of view in the host country. This
enables the expatriate to explain and understand host national behavior.
The content in didactic training is often hard facts like requirements for the job,
policies, travel arrangements etc., but it also contains aspects that help prepare By teaching such skills, the aim is to make the expatriate s attributes more isomorphic to the new
expatriates to establish a framework for understanding and adapting to a new culture.
culture when they arrive in their host country and facilitate lifestyle adjustments Attribution training is closely connected, but not limited, to a teaching method called cultural
assimilator (Grove & Torbiörn, 1985).

Language Training Interaction Training

Language training involves teaching the expatriate the native language and/or the business The method of Interaction training is based on interactions between new expatriates and
language of the host country. While fluency can take months or even years to attain there expatriates with more experience of the local culture. It can take place before departure
are still benefits of using this training method. with previous expatriates or at the arrival in the host country.
Overlaps in expatriate placements are a sometimes-used training method, which can be
Forster (2000) also concludes that some knowledge of the local language is important to
very beneficial for the expatriate s adjustment process.
send visible signals of politeness and to better understand the culture of the host country.
Benefits with overlaps include the possibility to explain tasks, introduce contacts and
Language barriers can prevent the expatriate from processing information posted in the otherwise coach in the management and operation of the workplace. Families can also
local language, both privately and at a professional level, and this prevents integration benefit in a similar way from interactions with the outgoing family
(Brewster, 1995, pp. 64-65)
Cognitive Behavior Modification
Cultural Awareness Training
This method is among the less used training methods when training an expatriate. The
The goal of Cultural Awareness training is to give the expatriate insight about the concept expatriates get to name what activities they find rewarding or punishing in the home
of culture and cultural differences, by teaching awareness about the home culture. culture context. By making such distinctions, the expatriate can hopefully apply the same
Training activities include self-awareness building and value ranking charts, but the goals process in the host country and enable him or her to identify and focus on rewarding
can also be reached with more culture-general approaches, such as simulation games and activities and feel positive about facing challenges of the host culture(Grove & Torbiörn,
perceptual exercises 1985)
 CULTURE AND LEADERSHIP
Leadership culture is the self-
are done
unconscious beliefs drive decisions and behaviors, and repeated behaviors become leadership practices.
Eventually these practices become the patterns of leadership culture.
CCL has found leadership cultures can be defined in three basic ways:
Dependent leadership cultures operate with the belief that people in authority are responsible for
leadership.
cultures operate with the belief that leadership emerges out of individual expertise
and heroic action.
Interdependent leadership cultures operate with the belief that leadership is acollective activity to the
benefit of the organization as a whole

CULTURE SHOCK
A sense of confusion and uncertainty sometimes with feelings of anxiety that may affect people exposed
to an alien culture or environment without adequate preparation.
An unpleasant experience that can be had when coming into contact with other cultures. Marx
developed a model in 3 levels can be called as Culture shock

Four Common Stages of Cultural Adjustment IHRM vs. HRM

STAGE DOMESTIC HRM IHRM
1: The Honeymoon Initial Euphoria/Excitement 1. Domestic HRM takes place at the national 1. IHRM takes place at the international level,
that is, in between two or more than two
level, that is, within a country countries
2: Culture Shock Irritation/Hostility
2. about managing employees belonging to 2. about managing employees belonging the
3. Gradual Adjustment, Humor, and Perspective one nation home country and host country as well as
third country employees
3. concerned with managing limited number
4. Feeling at Home Adaptation and Biculturalism of HRM activities at the national level
3. concerned with managing additional
activities such as expatriate management.
4. Domestic HRM is less complicated due to 4. IHRM is comparatively more complicated, as
it is deeply affected by the external factors
less imprint from the external such as cultural distance and institutional
environment. factors
International, Multinational , Global & Transnational Organizations
International
companies
Multinational
companies
Global companies
Transnational
companies
Multinational Companies
1. Multinational companies operate in more than one country and have a centralized
are importers and have investment in have invested and are are much more management system
exporters, they have other countries, but do present in many complex organizations.
no investment outside not have coordinated countries. They market They have invested in 2. Multi means many and national means the state.
of their home country. product offerings in their products through foreign operations,
Amazon each country. the use of the same have a central 3. A company may start in one country, and may spread to other foreign countries, expanding
More focused on coordinated corporate facility but their investments. Thus, a national industry becomes a multinational company.
adapting their image/brand in all give decision-making,
products and service markets R&D and marketing
4. though it spreads to many other countries, there will be a centralized management system,
to each individual local Generally one powers to each and the main decisions will always be taken by the home company.
market corporate office that is individual foreign 5. The other foreign corporations will be subsidiaries of the home company.
Colgate responsible for global market.
strategy. Emphasis on Nestle 6. When we think of the business environment of a multinational company, it may engage in
volume, cost exporting and importing goods and services, buying and selling license in foreign markets,
management and contract manufacturing, etc
efficiency.
Microsoft

Multinational Organizations Transnational Organisation

Transnational Companies Own a home company and Do not have subsidiaries
1. Transnational corporations also operate in many countries, and there isn t a centralized its subsidiaries but just many companies
management system
Have centralized Do not have centralized
2. These companies might start in one country, and later on they might expand to other nations
as well management system management system
3. They do not have a home company to manage them and will start as a new company. So, a Face barriers in decision Able to gain more interest
transnational company does not have subsidiaries.
making due to centralized in the local markets since
4. Since there isn t a centralized management system, a transnational company may take
decisions suitable to the operating context
system they have their own
5. May not be loyal to the operating country s value system but only will look into their Ex. Coca-Cola, McDonalds, systems
expansion of businesses, since they may have no connection with the particular country. Google Ex. Nestle
6. Transnational companies are there all around the world, and they operate truly at the global
level.
 International Company Multinational Company

International means Existing, Multinational means Including or

occurring, or carried on between involving several countries
nations. or individuals of several nationalities.
An International company does not A Multinational company has
have investment outside the home investments in other countries.
country Multinational companies refer to
International trade is the exchange of having investments in other countries
goods carried between countries but do not have coordinated product
offerings in each country. They are
more focused on adapting their Answer : B
products and service to each
individual local market

Universalism vs Individualism vs
Specific vs Diffuse: (Impact
Particularism: (Rules vs Communitarianism: (The
of Relationships)
Relationships) Individual vs The Group)
2. Trompenaars Framework A high importance on People believe in These cultures believe
Trompenaars and Hampden-Turner, two researchers identified seven cultural dimensions after laws, rules, values and personal freedom and that relationships do not
spending years researching people preferences and values towards culture around the world obligations. Try to deal achievement. Making have an impact on work
which was published in their . fairly with people based your own decisions and objectives.
The seven dimensions also known as 7d model which are on these rules. Rules taking care of yourself is
come before important. Good relationships are
[Link] vs. Particularism
relationships. important for meeting
[Link] vs. Collectivism Group is more important business operations.
[Link] vs. Diffuse These cultures focus than the individual.
more on relationships Groups provide help and
[Link] vs. Affective than rules. safety in exchange for
[Link] vs. Ascription loyalty. Groups come
[Link] time vs. Synchronous time before the individual.
[Link] vs. External control
274
 Neutral vs Emotional: Achievement vs Sequential Time vs
Internal Direction vs
Outer Direction: (How
3. Laurent Culture diversity
(How People Express Ascription: (How Synchronous Time:
People Relate To Their Laurent approach of multinational corporation: National culture seems to act as a strong determinant of
Their Emotions) People View Status) (How Time Is Used)
Environment) managerial ideology.
People control their People are valued for High value on Can control nature 1. Organizations as Political Systems: The dimension "organizations as political systems" clusters three
emotions. They don't what they have sticking to plans and or environment to items dealing, respectively, with the political role played by managers in society, their perception of
show how they are done. These cultures staying on schedule. achieve goals. power motivation within the organization , and an assessment of the degree to which organizational
feeling or what they value performance. structures are clearly defined in the minds of the individuals involved.
are thinking in their Work on several Believe nature or
head. People believe that projects at once and environment 2. Organizations as Authority Systems: "Organizations as authority systems" groups three questions
dealing with a conception of hierarchical structure as being designed to specify authority relationships a
you should be valued view plans and controls them. Must perception of authority crisis in organizations , and an image of the manager as a negotiator
In these cultures, for who you are. commitments as work within their
people are welcome Power, title and flexible. environment to 3. Organizations as Role-Formalization Systems: The three items clustered in "organizations as role-
to express their position matter in achieve goals. formalization systems" all focus on the relative importance of defining and specifying the functions and
emotions. these cultures and roles of organizational members .They stress the values of Clarity and efficiency that can be obtained by
implementing such organizational devices as detailed job descriptions, well-defined functions, and
these roles define precisely defined roles.
behaviour.
4. Organizations as Hierarchical-Relationship Systems

275

[Link]'s Cross cultural Model

Edward T. Hall was an anthropologist who made early discoveries of key cultural factors. In particular he is known for his Space
high and low context cultural factors.
Hall was concerned about space and our relationships within it. He called the study of such space
[Link] Proxemics. We have concerns about space in many situations, from personal body space to space in
the office, parking space, space at home.
High context : In a high-context culture, there are many contextual elements that help people to understand the rules. As
a result, much is taken for [Link] can be very confusing for person who does not understand the 'unwritten rules' of The need for space: Some people need more space in all areas. People who encroach into that space
the culture. are seen as a threat
Low context : In a low-context culture, very little is taken for granted. Whilst this means that more explanation is needed,
it also means there is less chance of misunderstanding particularly when visitors are present.
High territoriality Some people are more territorial than others with greater concern for ownership.
They seek to mark out the areas which are theirs and perhaps having boundary wars with neighbors.
[Link] This happens right down to desk-level, where co-workers may do battle over a piece of paper which
overlaps from one person's area to another. At national level, many wars have been fought over
Monochronic time : M-Time, as he called it, means doing one thing at a time. It assumes careful planning and scheduling
and is a familiar Western approach that appears in disciplines such as 'time management'. Monochronic people tend also
boundaries. People high territoriality tend also to be low context.
to be low context. Low territoriality People with lower territoriality have less ownership of space and boundaries are
Polychronic time : In Polychronic cultures, human interaction is valued over time and material things, leading to a lesser less important to them. They will share territory and ownership with little thought. They also have
concern for 'getting things done' -- they do get done, but more in their own time. Aboriginal and Native Americans have less concern for material ownership and their sense of 'stealing' is less developed (this is more
typical polychronic cultures, where 'talking stick' meetings can go on for as long as somebody has something to important for highly territorial people). People with low territoriality tend also to be high context.
[Link] people tend also to be high context.
 [Link] Integration-Responsiveness
Grid. (Prahalad and Doz, 1987)

P. MORGANS Model of IHRM(1986) [Link] model of Perlmutter

/Permutter Theory A) Product Life Cycle
model of Adler and Ghadar
(1990)
[Link] change models
Models of B) The Milliman and Von
IHRM Glinnow (1990) model
[Link] et al., (1993): Integrative
framework of international HRM

[Link] et al., (1996): Exportive,

Integrative and Adaptive model

[Link] Paradigm or Ownership,

Location and Internalisation
Framework.(1979) John H Dunning

Where do global strategies arise from?

1) Global integration of activities
[Link] Integration-Responsiveness Grid. (Prahalad and
2) Global strategic coordination
3) Local Responsiveness Doz, 1987)
What is global integration of activities? 1. The integration-responsiveness (IR) framework of Prahalad and Doz (1987)
has been used extensively in the international business literature to identify
Centralized management of geographically separated activities. the diverse and often-conflicting pressures confronted by firms as they
Integration of activities reduces costs and optimizes investment expand their activities worldwide.
What is global strategic coordination? 2. The framework has also been used to discuss how these pressures impact on
key decisions that affect firm performance e.g., whether firms should
The central management of resource commitment across national boundaries in the pursuit of a standardize marketing activities globally or adapt them to local conditions, or
strategy. whether firms should centralize or decentralize control of subsidiary
Goals is to build and defend long-term competitive advantage operations
Integration-responsiveness framework
What is local responsiveness? An MNE management framework for simultaneously dealing with the pressures for both global
integration and local responsiveness.
Resource commitment decisions taken by a subsidiary in response to local competitive or
customer demands
Integration-responsiveness framework
An MNE management framework for simultaneously dealing with the pressures for both global integration and local
responsiveness.

Firms face these two conflicting pressures for IB strategy:

Global integration and local responsiveness
Framework dates to Doz, Bartlett & Prahalad, 1981, Global competitive pressures and host country demands CMR.
Pressures for global integration
- Globalization of markets

Efficiency gains of standardization

Pressures for local responsiveness Figure 1. The integration-responsiveness grid.

(Prahalad and Doz, 1987)

Divergent consumer tastes & preferences due to culture, history, nationalism, economic distance, distribution channels
- Host government policies

Multidomestic strategy International strategy ("home replication")

Global Strategy Transnational Strategy - extensive customisation: maximum local -Leveraging home-based core competencies :
responsiveness attain business effi ciency by transferring
low pressure for local responsiveness & high Combination of localizing strategy - production, marketing, R&D in EACH market valuable skills
pressure for global integration - coordination and cooperation in an and products to host country markets where
- low experience curve effects and location
Economies of scale and location economies environment of shared decision making economies indigenous competitors lack those skills and
:global organisations prefer to market a Balancing concentration to tap location - Informal HQ-subsidiary relationship; product
standardised product worldwide so that they subsidiaries have high autonomy Selling the same products or services in both
economies for low cost strategy and
can reap the maximum benefi ts from the domestic and foreign markets
dispersion to - High cost structure
economies of scale - Centralized HQ control, formal planning and
meet local preferences - high pressure for local responsiveness & low
- Low cost strategy based on volume & cost pressure for global integration control, tight HQ-Sub linkage
reduction; maintaining & coordinating global learning &
- HQ manages transfer of skills & expertise
- tight HQ coordination of decisions, knowledge flows as key challenge to drive from parent company to international units
Examples in text: Unilever, Nestle, Heinz, Body
resources, information innovation Shop, McDonald's, Johnson & Johnson, Pfizer, -- low pressure for local responsiveness & low
- high pressure for local responsiveness & high Embraer, Ranbaxy pressure for global integration
Examples in text: Toyota, Canon, Haier, Texas pressure for global integration
Instruments,Caterpillar, Cemex, Infosys, Examples in text: Kraft, Google, P&G, Nucor,
Walmart, Huawei, LVMH, Amex, Nokia, Cisco Harley Davidson, Baidu, Apple, Carrefour
Examples in text: GE, Tata, Zara, IBM
 [Link] model of Perlmutter /Permutter Theory
1. Perlmutter (1969) is widely recognised as one of the first theorists to propose
a network based model of how international companies organise globally.
2. Kobrin (1994) explains that Perlmutter s adoption by the international HRM
theorists is largely because the classification is defined in terms of human
resource management issues (e.g. training, recruiting, selecting people and
resources).
3. Perlmutter initially defined three organisational types based on senior
management s cognitions or mindsets: the ethnocentric, polycentric and
geocentric organisation. Later he defined a fourth mindset, namely, the
regiocentric.

Ethnocentric Polycentric Geocentric Regiocentric

orientation orientation orientation orientation

subsidiaries have
Each subsidiary is
treated as a distinct to its operations - a degree of regional
[Link] change models
any autonomy national entity with each part autonomy in 1. Two models based on an organisational change perspective have been put
some decision- (headquarters and decision-making
are made at HQ. making autonomy subsidiaries)
forward, namely the Product Life Cycle model of Adler and Ghadar (1990)
contributes to usually managed by and the Organisational Life Cycle model of Milliman and Von Glinnow
domestic and usually managed by unique competence nationals from the (1990).
foreign operations local nationals -wide same region who
2. These models have been designed to explain how and why the international
are held by (HCNs), integrated business, are seldom
managers from HQ who are seldom nationality is less promoted to HRM orientation of a multinational changes over time in line with changes
promoted to important than positions at HQ in its corporate strategy.
managed by PCNs. positions at HQ, individual abilities 3. Both approaches also recognise the variable importance of the parent or
and PCNS are rarely of its employees
transferred to home country context and the host country context throughout each stage.
foreign subsidiary 4. In doing so they take a largely cultural approach.
operations.
 A) Product Life Cycle model of Adler and Ghadar
Domestic International

Here the focus is on the home market. Competition increases and international markets
(1990) The products/services are unique, they have not
been available before, therefore the price is high
become more important for profit.
There is a shift in focus from product
relative to cost and competition minimal. development (R&D) to manufacturing and plants
The Adler and Ghadar (1990) model is based on the product life cycle (PLC) during As the products are unique there is no need for are set up locally and divisional structures
internationalisation, first observed and described by Vernon (1966), and is a stage cultural sensitivity and if they are exported they emerge.
model of organisational change. are in a significantly strong position not to need Cultural sensitivity becomes critical to effective
adaptation. corporate strategies.
In Adler and model they describe how the role of culture changes in The HR needs are therefore not that demanding in However, decision-making and control tend to
salience and how HRM activities are modified at each stage in response to product international terms, i.e. expatriate assignments, remain with the parent.
strategic requirements and cultural requirements. internal business trips, cross-cultural training are HR performs a vital role in attaining control of
not warranted for the expor market. local operations.
Adler and Ghadar 4 Phases of HRM + Focuses (DIMG) Home country personnel are used to transfer
1. Domestic technology and management systems overseas
where replication, rather than innovation, is the
2. International prime objective.
Training in cultural sensitivity and adaptability is
3. Multinational key at this stage.
4. Global

Multinational Global

The product/service reaches maturity, the three prior phases were based on
competition is intense and the price has fallen. hierarchical structures. This phase is based on
Coordination of resources becomes a vital tool the assumption that the organisation will need
in the reduction of costs. to operate in all three phases simultaneously
The role of culture becomes less important as
the issue of reducing costs takes central ventures, wholly owned subsidiaries and
position.
(Adler and Ghadar, 1990: 240).
As such the best people are usually chosen for
international posts to increase profits and focus on both local responsiveness and global
control costs. integration, emphasis on gaining global
advantage (standardization + diversification),
The management assumption at this phase is
afford managers opportunity to grow.
that organisational culture is more important
than national culture, therefore sensitivity to
local cultures is seen to be less important and
recruitment of international managers tends
to be from those familiar with the parent
culture.
 [Link] ., (1993): Integrative framework of
B) The Milliman and Von Glinnow (1990) model international HRM
The Milliman and Von Glinnow (1990) model identifies four international HRM objectives, 1. The Schuler et al. (1993) integrative framework of international HRM was, in essence, a
namely, timing, cost versus development, integration and differentiation: conceptual framework that attempted to map HRM activity to the varying strategic requirements
for integration and local responsiveness which define MNC strategy.
Timing Cost Integration Differentiation
2. Human resource management issues, functions, policies and practices that result from the
Timing refers to whether Cost refers to whether the Integration relates to the Differentiation refers to strategic activities of multinational enterprises and that impact the international concerns and
the organisation takes a organisation needs to use of expatriate managers the development of a goals of those enterprises.
short-term or long-term focus on lowering costs or in implementing informal network of home and host
perspective in its business can focus on longer-term control systems. country managers to 3.
and international HRM development issues in its facilitate communication management processes of the organisation and to emphasise coordination or congruence among
strategy. overseas operations and and control between the various human resource management practices. Thus, SIHRM is used to explicitly link IHRM with
The former requires quick the career paths of its parent and subsidiary.
expatriate managers. the strategy of the MNC.
responses, the latter
allows a longer period for 4. This integrative framework of SIHRM identifies a series of strategic MNE (multinational enterprise)
implementation, which
can mean longer components, endogenous factors and exogenous factors that shape the issues, policy, practices
international assignments and functions of HRM in international organisations. These determinants are explained, briefly:
and commitment to
overseas operations.

[Link] MNE components Exogenous factors Endogenous Factors

include interunit linkages and These describe forces that are These describe the issues and
internal operations. external to the firm that are concerns that are internal to the
Interunit linkage is concerned largely beyond an MNE's control firm and include structure of the
with the need to differentiate or but can create challenges that organization, stage of
integrate several operations affect an organizations IHRM internationalization, business
which are geographically issues, functions, policies and strategy, and headquarters'
dispersed (Ghoshal and Bartlett, practices. international orientation.
1998; Prahalad and Doz, 1987). Politics, economic conditions, Diversity, coordination
Internal operations refer to how legal environment.
each unit operates within its
local environment.
The restrictions of national
institutional or legisative
frameworks are recognised,
along with the cultural diversity
in attitudes towards work,
management, authority and so
forth (Hofstede, 1980; Laurent,
1983; Schein, 1984).
 [Link] ., (1996): Exportive, Integrative and Adaptive: (MNEs design HR
systems for subsidiaries, to
Exportive ((MNEs completely
transfer all the 'parent' country
Integrative: (MNEs design HR
systems for subsidiaries, to
Adaptive model(EIA Model) reflect the local environment)
HRM reflects subsidiary HRM
HR systems into subsidiaries)
HRM focuses on replication
reflect the local environment)
HRM is based on the notion
Taylor et al. (1996) apply the resource-based theory of the firm to explain and predict why systems designed to match of parent HR systems in of taking the best HRM
international organisations adopt different forms of strategic international HRM. the local environment. subsidiaries. Integration is a systems from anywhere in
Differentiation is emphasised key priority and all HRM the company and allowing
Resource-based theory of the firm (Barney, 1991) applied to HR issues (Lado and Wilson, 1994) functions are affected, not for both global integration
argues that HR can facilitate strategic goals by developing competencies within the organisation and HRM is concerned with
the appointment of local and local differentiation and
that are valuable, rare, hard to imitate and non-substitutable.
senior mangers but also with (managers. This approach is geocentric in nature.
1. valuable if they are differentiated and provide the company with something that they lack; little transfer of HRM focuses on maximising global
philosophies, policies, or integration and is
2. rare if they are scare or in short supply; practices from the parent to ethnocentric in nature.
3. hard subsidiary or between
and thus based on collective values; subsidiaries. This approach
focuses on attending to local
4. non-substitutable where they cannot be easily replaced through recruitment, for example in differentiation needs and is
the case of tacit knowledge polycentric in nature.

[Link] Paradigm or Ownership, Location and Ownership advantage Location Advantage

Internationalization
Advantage

Internalisation Framework.(1979) John H Dunning The ownership advantage

can also be seen as the
FDI destination market must
offer factors (land, capital,
Is it more attractive to
perform the value chain
An eclectic paradigm is also known as the ownership, location, internalization (OLI) model or OLI competitive advantage that knowhow, cost/quality of activity in-house than to
framework. comes with the FDI. labor, economies of scale) have it performed by an
A foreign firm is always at a that are advantageous for external party?
The eclectic paradigm takes a holistic approach to examining entire relationships and the firm to locate its
disadvantage to a local firm, Reasons to outsource
interactions of the various components of a business. investment there (link to
so you've gotta have certain activities to different
The goal is to determine if a particular approach provides greater overall value than other something (brand name, trade theory) companies abroad might be
available national or international choices for the production of goods or services. etc) to compete with them because they are better at
on their own turf!!!! it, are able to do it cheaper,
Not a theory but a paradigm.
have more local market
- Provides a complete statement of the FDI activity knowledge, or because
management simply wants
- Eclectic: Integrates 3 different principles to focus on other activities
in the value chain such as
1. Ownership Advantage, 2. Location Advantage 3. Internalization Advantage
marketing or design.
- Developed over time by scholars, mainly Dunning
 Geert Hofstede's Onion Model
1. Culture' is like an onion: a system that can be peeled, layer by
layer, in order to reveal the content. Imagine the whole onion
as 'culture' and as you peel on, you see different levels which
work on and influence culture (in any particular society).
2. Four basic elements of culture in Geert Hofstede`s onion
model of culture
3. Values, rituals, heroes and symbols
4. All three layers can be trained and learned through practices
except for the core: the inner cultural values

304

Values Rituals Heroes Symbols:

The core stands The first layer Second layer are Third layer is
for the value of around the core the heroes. symbols.
a certain culture is rituals. A ritual People who play Nowadays most
which mostly can be the way a role-model in symbols appear
remains the of personal that society as brands like
same. hygiene (most Apple & BMW.
Asians shower in Those symbols
the evening, usually move
Europeans in according to the
the morning). momentary
Rituals are fashion.
changing slowly.

305 306
 Onion model of culture by Trompenaars and Hampden-
Turner (1997, p. 22) /Model of National Culture Differences
Trompenaars and Hampden-Turner developed the model after spending 10 years researching the
preferences and values of people in dozens of cultures around the world. As part of this, they sent
questionnaires to more than 46,000 managers in 40 countries.
Trompenaars and Hampden-Turner concluded that what distinguishes people from one culture
compared with another is where these preferences fall in one of the following seven dimensions*:
1. Universalism versus particularism.
2. Individualism versus communitarianism.
3. Specific versus diffuse.
4. Neutral versus emotional.
5. Achievement versus ascription.
6. Sequential time versus synchronous time.
7. Internal direction versus outer direction.

307 308

Eugene Bunkowske's cultural onion diagram.

three basic levels in seven basic layers in
Eugene Bunkowske's Eugene Bunkowske's
cultural onion diagram. cultural onion diagram.
1.) Foundational level; 1.) Artifacts
2.) Evaluating level; 2.) Behaviors
3.) Actualizing level. 3.) Feelings
4.) Values
5.) Beliefs
6.) Worldview
7.) Ultimate allegiance
309 310
1. In 1976, Hall developed the iceberg analogy of culture. If the
culture of a society was the iceberg, Hall reasoned, than there are
some aspects visible, above the water, but there is a larger
portion hidden beneath the surface.
2. Three basic parts of the cultural iceberg metaphor : Above the
water line, at the water line, below the water line

311 312

7 important actions involved in the definition of

Cultural diversity multiculturalism
Culture : Culture is that which shapes us; it shapes our identity and influences our behavior. Sociologist Dr. Caleb Rosado described seven important actions involved in the definition of multiculturalism.
1. recognition of the abundant diversity of cultures;
beliefs, values, norms, behaviors, and material objects that are passed down from one
generation to the next. 2. respect for the differences;
The 3. acknowledging the validity of different cultural expressions and contributions;
Multiculturalism is defined as
4. valuing what other cultures offer;
system of beliefs and behaviors that recognizes and respects the presence of all diverse 5. encouraging the contribution of diverse groups;
groups in an organization or society, acknowledges and values their socio-cultural 6. empowering people to strengthen themselves and others to achieve their maximum potential by being
differences, and encourages and enables their continued contribution within an inclusive critical of their own biases; and
cultural context which empowers all within the organization or 7. celebrating rather than just tolerating the differences in order to bring about unity through diversity.
 Stages and Levels for becoming a Multicultural Organization
Types of Multiculturalism Jackson et al. (1993) propose a set of stages and levels through which an organization has to go through, to
1. Domestic Multiculturalism : Domestic Multiculturalism is a phrase used to define the variety of cultures within become a multicultural organization. The brief description about these stages and levels are as follows:-
the boundaries of a specific domestic geographic area. An example of domestic multiculturalism is the variety of
cultures located within the country. 1. (a) Level 1 and Stage 1- The exclusionary Organization: This organization maintains the power of dominant
groups in the organization and excludes the others
[Link] Multiculturalism
b) Level 1 and Stage 2 The Club: This club still excludes people but in a less precise way. Some minority group
There are a number of ways that diverse groups can be catego-rized. Four of the most common include: members are allowed to remain in the group, till the time they conform to pre-defined norms.
[Link] groups,in which members have similar backgrounds andgenerally perceive, interpret, and (a) Level 2 and Stage 3- The Compliance Organization: This organization recognizes that there are other
evaluate events in similar ways. An exam-ple would be a group of male German bankers who are forecasting the perceptions as well, but does not believe in causing any sort of trouble. It actively recruits minority groups at the
eco-nomic outlook for a foreign investment bottom of the organization and make some token appointments
[Link] groups, : in which all members but one have the same background. Anexample would be a group of (b) Level 2 and Stage 4- The Affirmative Action Organization: This organization is determined to eliminate
Japanese retailers and a British attorney who arelooking into the benefits and shortcomings of setting up discrimination and encourages employees to examine their attitudes and think differently.
operations in Bermuda.
3. (a) Level 3 and Stage 5- The Redefining Organization: The redefining organization develops and implements the
[Link] groups, : in which two or more members represent each of two dis-tinct cultures. An example would policies to encourage distribution of power among all the groups in the organization.
be a group of four Mexicans and four Canadi-ans who have formed a team to investigate the possibility of investing
in Russia. (b) Level 3 and Stage 6-The Multicultural Organization: The organization reflects the contribution and interests of
its entire diverse workforce in everything it does and supports. All the members willingly and actively participate in
[Link] groups : in which there are individuals from three or moredifferent ethnic backgrounds. An the organization which leaves a positive impact on the external stakeholders
example is a group of three American, three German, three Uruguayan, and three Chinese managers who are look-
ing into mining operations in Chile

Diversity Management Benefits of Cultural Diversity

Wentling 1. Diverse cultural perspectives can inspire creativity and drive innovation
works naturally for the total diversity mixture, but not just for women and minorities
Approaches to Diversity Management
2. Local market knowledge and insight makes a business more competitive and profitable

Thomas and Ely (1998) identified three paradigms for managing diversity. These approaches help to 3. Cultural sensitivity, insight, and local knowledge means higher quality, targeted marketing

approaches is as follows: 4. Drawing from a culturally diverse talent pool allows an organization to attract and retain the
1. Discrimination and Fairness Approach: focuses on making proactive programmes for ensuring 5. best talent
equal opportunity, fair treatment, recruitment and observance of Equal Employment Opportunity
conditions for everyone. 6. A diverse skills base allows an organization to offer a broader and more adaptable range of
2. Access and Legitimacy Approach: The approach focuses on the acceptance and utilization of the
products and services
differences among employees to cater the diverse customer groups. 7. Diverse teams are more productive and perform better
3. Learning and Effectiveness Approach: This learning and effectiveness approach aims at integrating
employees by recognizing that cultural differences are an important source of organizational learning 8. Greater opportunity for personal and professional growth
 Challenges Green HRM
1. Colleagues from some cultures may be less likely to let their voices be heard 1. GHRM is a new concept and is becoming popular all over the world
2. Integration across multicultural teams can be difficult in the face of prejudice or negative 2. It refers to making efforts to improve energy efficiency or reduce the pollution produced by
our home, business, and general living habits.
cultural stereotypes
3. The main purpose of going green is to reduce the potential negative impact that energy
3. Professional communication can be misinterpreted or difficult to understand across consumption and pollution can have on the environment.
languages and cultures 4. Ramachandran defines Green HRM as the integration of environmental management
into human resources management.
4. Navigating visa requirements, employment laws, and the cost of accommodating workplace
requirements can be difficult 5. The term green HRM is mostly used to refer to the contribution of HRM policies and
practices towards the broader corporate environmental agenda.
5. Different understandings of professional etiquette
6. Green Human Resources Management (GHRM) can be defined as the set of policies,
6. Conflicting working styles across teams
in order to create an environmentally sensitive, resource efficient and socially
responsible workplace and overall organization.

27. Based upon a study on cultural diversity in multinational corporations the

following four dimensions
emerged that differentiated national cultures in terms of their managerial [Link] Matrix identifies the interrelationships between
ideologies : HRD instruments, processes, outcomes and organisational
(i) Organisation as a political system
(ii) Organisation as an authority system effectiveness is given by
(iii) Organisation as role formalization system A.T.V Rao
(iv) Organisation as hierarchical-relation system
Who among the following is associated with the study ? [Link] Nadler
(1) Hofstede [Link] Subba Rao
(2) Triandris
(3) Laurent [Link]
(4) Maurice
 3. Match the following
HRD HR Matrix components includes

1. HRD Instruments a. Commitment and satisfaction

organized, for a specific time, and designed to bring about the possibility of
2. HRD Processes b. Long term growth, ROI

A.T.V Rao [Link] Outcomes c. performance planning and role clarity

[Link] Nadler 4. Organizational Effectiveness d. performance appraisal and role

analysis
[Link] Subba Rao
[Link]
Codes
A. d, c, a, b
B. c, d, a, b
C. b, d, c, a
D. a, b, c, d

[Link] Capital Appraisal approach by Friedman et al (1998) of Arthur Anderson consulting

5. Which of following form the part stages of maturity of PCMM Approach(The
company is based on the belief that there are five stages in the management of human People Capability Maturity Model).
capital, arrange the stages in sequence a. Initial,
A. clarification stage, assessment stage, design stage, implementation stage and monitoring b. Repeatable
c. defined,
stage. d. managed,
B. assessment stage, design stage, clarification stage, implementation stage and monitoring e. Optimizing
stage.
Codes
C. design stage, assessment stage, clarification stage, implementation stage and monitoring A. b, c, d, & e
stage B. a, b, c, d & e
D. design stage, clarification stage , assessment stage,, implementation stage and C. c, d & e
D. a, c, d, & e
monitoring stage
 [Link] Organizational Culture Assessment Instrument (OCAI) was developed
[Link] Strategic HR Framework Approach of HRD is
by University of Michigan business professors Robert E. Quinn and Kim S.
formulated by
Cameron. The framework focuses on four distinct types of company cultures
[Link] and Lake
which of following is not the part of this framework?
[Link] and Berman (1997)
A. Adhocracy
[Link] et. al, 1995
B. Market
[Link] and Rao
C. Pragmatic Culture
D. Clan

[Link] A Cooke proposed three types of culture in the

9. The key features of a constructive culture includes all except
organization, all are included except
A. Self Actualizing
[Link] Culture B. Opposition
[Link] Culture C. Encouragement

[Link] Culture D. Achievement

[Link] Culture
10. Standard Cost Approach of HR Accounting is given by [Link] to his model, the human resources are to be
A. Flamholtz valued on a group and not in individual basis
B. David Watson. [Link] Benefit Model
C. Rensis Likert
[Link] Goodwill Model
D. Hekimian and Jones
[Link] Payment Approach
[Link] Human Asset Multiplier model

[Link] Cultures are identified by

13.A/an ____________ conflict occurs in the form of a
A. centralization of power with the leader fundamental disagreement over ends or goals and the means for
B. culture has the values of bureaucracy accomplishment.
C. flexibility, consultation, change and innovation (a) relationship
D. environment is a friendly one (b) emotional
(c) substantive
(d) procedural
 [Link] approach to conflict management can be best [Link] of the following statements is TRUE?

described as both highly cooperative and highly assertive? A. Arbitration is necessary when one or more of the parties involved is

(a) competition unwilling to compromise.

(b) compromise B. Mediation involves a third party who does not help make a decision.

(c) accommodation C. A compromise is a jointly reached solution where both parties agree

(d) collaboration to give up part of their plan to reach a solution.

D. all of the above

17. In the balanced scorecard framework, employee retention

[Link] of the following is NOT a component of the is a potential measure belonging to which of the four

balanced scorecard? perspectives?

a. Financial.
a. Strategic objectives.
b. Customer.
b. Targets.
c. Internal business processes.
c. Strategy initiatives.
d. Learning and growth.
d. Assessment of human resources.
[Link] is the most important purpose of a balanced scorecard? [Link] of the following is not one of the four
a. Develop strategy.
perspectives of the balanced scorecard?
b. Measure performance.
a. Investment in resources perspective.
c. Develop cause-and-effect linkages.
b. Customer perspective.
d. Set priorities
c. Learning and growth perspective.
d. Financial perspective

20 refers to a process for assigning financial and non-financial

goals to the HR management-related chain of activities required for
achieving the company's strategic aims and for monitoring results?
A. HR scorecard
B. Strategy map
C. HR feedback scale
D. HR dashboard
 22. The SECI Model and Knowledge Conversion given by Nonaka and
21. In the process of alternative dispute resolution known Takeuchi is based on the two types of knowledge :
as ____________, a neutral third party acts as a "judge" to a) explicit knowledge
b) tacit knowledge
determine how a conflict will be resolved. c) Empirical Knowledge
(a) mediation d) Distributed Knowledge

(b) arbitration Codes

(c) conciliation A. a & d
B. a & b
(d) collaboration C. a & c
D. b & c

23. Ways of knowledge conversion Combination of knowledge

1. Socialization a. Explicit to explicit.
24. Which is the simplest way in which knowledge is shared and created in the
2. Externalization b. Explicit to tacit.
organization.
3. Combination c. Tacit to explicit A. Externalization: Tacit to explicit
B. Combination: Explicit to explicit.
4. Internalization d. Tacit to tacit
C. Socialization: Tacit to tacit
Codes D. Internalization: Explicit to tacit.
A. d, c, b, a
B. C, d, b, a
C. B, d, c, a
D. d, c , a, b
 25. Which of the following is not the dimensions in 26 Which model that clearly distinguishes between individual

the Wiigs KM model : knowledge and social knowledge following an epistemological point of view

[Link] regarding knowledge management.

[Link] Wiig Model for Building and Using Knowledge
[Link] and purpose
[Link] SECI Model and Knowledge Conversion
[Link] expertise
[Link] von Krogh and Roos Model of Organizational Epistemology
[Link]
[Link] Choo Sense-Making KM Model (1998)

28 .In this method of executive development a trainee is assigned a project which is

27. To develop a standard or benchmark, firms need to closely related to his job
start with A. Special Courses
A. Determining what to benchmark B. Committee assignment

B. Identifying benchmarking partners C. Special Projects Assignment

C. Forming a benchmark team D. Under Study

D. Collecting benchmarking information

29. All of the development method help to develop decision making [Link] of the following technique helps to develop job
skills except. knowledge
A. In basket [Link] playing
B. Business Games [Link] course
C. Case studies
[Link]
D. Sensitivity training
[Link] assignment

31. Which of the following is not a goal of a management development programme?

A. To make certain that the managers are aware of the latest and best managerial
practices, measurement methods and work techniques
B. To ensure that the attitudes, values and beliefs of the managers match the core
values and strategy of the organization
C. To assist the managers to build on their strengths and work on their weaknesses
D. To ensure that there is no delay in the settlement of retirement benefits of the
managers
32. Trainees forming teams and assuming managerial roles in two or
more imaginary but rival companies is part of the _______ 33.A programme of one-to-one collaboration between a certified

development technique. external expert and a manager for developing the leadership skills

A. university-based programmes of the latter is called

B. external coaching A. Executive Orieantation

C. in-house development centres B. Executive coaching

D. None of these C. Mentoring

D. None of these