HUMAN RESOURCES

CHAPTER 2: THE CONTRIBUTIONS OF HUMAN RESURCES MANAGEMENT

MANAGEMENT
1st Semester | A.Y. 2025-2026 | BSBA – 2I

A. COST REDUCTION AND PROFIT

ses managers
are
INCREASE THROUGH HUMAN properly
trained
RESOURCES MANAGEMENT  A working
climate that
Gow explains how human resources keeps
management "contributes to corporate profit by morale high
reducing, containing and avoiding costs." His outline is
of how it helps reduce costs is stated below. maintained
 The
manufacturi
Human Resources Management concerns itself ng people
about humans in the firm. It has developed from the produce
personnel department. The main idea of HRM is to goods in
distribute the functions of personnel department over the needed
a large amount of people making responsible for number and
something and decreasing the costs. quality
 Scrap  Productivity
 Cost /efficiency
The human resources management is very useful
varian  Dedication
for firms to achieve their goals. It helps firm to
ces to quality
improve performance by authorizing the right people  Loss of work is
of doing relevant trainings and developmental materi promoted
activities for other workers. als  Waste and
 Off- scrap are
3. Facto
It helps the firm too increase the motivation of its spec eliminated
ry
workers, the performance. Another important produc  Output is
cost
ts increased
contribution of Human Resources Management is adjus
 Engine  Attitudes
balancing the financial status of the firm. HRM deals tmen
ering leading to
with salaries and wages. It helps to save a great deal ts
and mistakes
(FCA)
of money and increase the reputation of the purcha are
firm/business. sing eliminated
expen
Below is a matrix showing the significant ses
 Trial
contributions of Human Resources to cost reduction.
produc
tion
Some costs
contributions of b. Oper  Distrib  Warehouse
Kinds of
Components HR to cost ating ution people are
expenses
reduction, costs  Advert properly
insuring that ising managed
 Goods  manpower and  Morale is
a. Cost and is not promo increased
of materi misused or tion through
prod als misdirected  Selling good
ucts  utilitie  everyone  Produc compensati
sold s does a t on and
day’s work servic employee
 Depre For a day’s pay e policies
ciation  Work is not  R&D  Less service
 People interrupted  Admini and repair
1. Facto strativ costs are
-  Accidents
ry e and anticipated
related are reduced
Inven genera by assuring
ones  Turnover is
tory l product
minimized
Costs servic quality
 Materials
(FIC) es  Good R&D
and time
are not people are
wasted hired and
retained
2. Plant  Plant  The right
 The right
burd utility people are
jobs are
en  Overh recruited
assigned to
ead  The sales
the right
expen force and
HUMAN RESOURCES
CHAPTER 2: THE CONTRIBUTIONS OF HUMAN RESURCES MANAGEMENT

MANAGEMENT
1st Semester | A.Y. 2025-2026 | BSBA – 2I
people by providing effective compensation packages
assisting and preparing them to cope up with
1. Factory Inventory, Depreciation and increasing technological advances and thus in the
People-related Costs process of quality control, which is directly related to
the successful accomplishment of company goals.
a. Work is not interrupted if HRM provides
incentives for the workers so that continuous Activity:
work could be done to avoid depreciation. Direction: Read and analyze the following
b. Accidents are reduced if proper maintenance article:
of machines is practiced
c. When employees are satisfied with their jobs, In a knowledge-based economy, the
personnel turnover is minimized important areas of knowledge and technologies that
are developed are primarily the development of data
2. Plant Burden processing analytics in Business Intelligence
enterprises, the development of life science
a. If the right people are hired, they would be technologies, eco-innovation and many more. The
knowledgeable about the equipment they technological revolution, known as 4.0, is motivated
use. by the development of the following factors like
b. The right people are more productive and database technologies, cloud computing, machine
efficient that the wrong people who just learning, internet and artificial intelligence. In the
increase overhead expenses realities of the current technological revolution
known as the 4.0 industry, new concepts of
technology management or internet-based
3. Proper Training of the Sales Force
companies are emerging.
and Managers
In view of the above, please consider
a. If managers are properly trained, they can in
answering the following questions:
turn motivate their employees to work more
efficiently and work productively.
1. Will the advancement of technology affect
b. If sales forces are trained well, goods are sold
the role of human resources in the
quickly; there will be less inventory and less
workplace? Why? In what way?
storage costs for keeping unsold goods.
c. Wastage of materials is avoided
2. What are the most effective contributions
of human resources in internet-based
4. Factory Cost Adjustments companies that are emerging today?
3. Will the automation in the processes of
a. Scrap- If people know what they are doing business transactions totally replace the
with proper management, they are bound to role of human resources in the workplace?
make less mistakes and thus minimizing Why?
scrappage.
b. Loss of materials- Highly motivated people
B. THE HR STRATEGIES: LINK
will always take into consideration the
availability of materials and their proper BETWEEN HRM AND PERFORMANCE
utilization.
c. Purchase Expense- Highly motivated people The Concept of Human Resources Management is
will try to save for the company by based on the notion that HR strategy can contribute
canvassing first before making the purchase in business strategy.
order.
Whether an employee is working in a large corporate
The above HRM contributions help in motivating or smaller enterprise, a human resources strategy
employees and enhancing their commitment and forms the basis of everything you do in Human
greater involvement in the overall quality Resource.
improvement. Thus, an effective Human Resources
Management gives chance to employees in HR Strategy - is a business's overall plan for
contributing efficiency and productivity to the overall managing its human capital to align it with its
company direction and the accomplishment of the business activities. The HR Strategy sets the direction
organization's goals and objectives. for all the key areas of HR, including hiring,
performance appraisal, development, and
From HRM perspective, the most important value compensation.
is employees. It helps businesses to conserve costs
HUMAN RESOURCES
CHAPTER 2: THE CONTRIBUTIONS OF HUMAN RESURCES MANAGEMENT

MANAGEMENT
1st Semester | A.Y. 2025-2026 | BSBA – 2I
HR Strategy (Human Resource Strategy) is a 6. Communicate effectively with employees so
designation for a long-term plan created to achieve that that are kept informed of major issues
objectives in the field of human resource and human confronting the organization and any major
capital management and development in the initiatives.
organization. Human Resource strategy is one of the
outputs of strategic management in the field of
human resources management.

CHARACTERISTICS OF HUMAN RESOURCE

STRATEGY:

1. It requires an analysis of the organization

and the external environment
2. It takes longer than one year to implement.
3. It shapes the character and direction of
Human Resources Management activities
4. It helps in the deployment and allocation of
organizational resources (money, time, and
personnel)
5. It is revised on a yearly basis.

An HR strategy's effect on firm performance is always

dependent on how well it fits with other factors. This
fact leads to simple yet powerful prediction for HR
strategies that has been widely supported by
research.

The Characteristics that give a firm a competitive

edge:

HR Strategies make greater contribution to

firm performance:

1. They help the company exploit its specific

advantages or strengths while avoiding
weakness
2. They assist the firm in better utilizing its own
unique blend of human resource skills and
assets.

HUMAN RESOURCE BEST STRATEGIES:

1. Offer high employment security as this

indicates that the firm is committed to the
employee's welfare.
2. Develop a good selection program that can
screen the best applicants.
3. Offer wages that are highly competitive as
this helps reduce employee turnover and
helps in the attraction of high quality
employees.
4. Recognize employees by providing monetary
and non-monetary rewards.
5. Make employees part-owners of the firm by
providing them with the stock in the firm.