The Functions of HRM by slappypappy129

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									The Functions of HRM
The role of the Human Resource Management Department The HRM Department has a very important role in helping the organisation to achieve its goals. The HRM Department’s plans must be linked to the organisation’s goals.

e.g. if one of the organisations goals is to open 2 new branches in the next 6 months, the HRM Department find suitable new employees to work in these new branches.

The role of the HRM Department is dealing with issues relating to employees – recruiting them, developing them and helping manage them. The HRM Department helps the organisation manage its human resources (i.e. employees) so that they best support the organisations goals.

Benefits of having a HRM Department

There are many benefits for an organisation due to having a HRM Department. Some are listed below:  The HRM Department helps the organisation meet its goals by managing employees.  The organisation’s human resource needs are forecast. This ensures the organisation is prepared for changes in the future.

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 The HRM Department helps the organisation be competitive by training and developing employees.  The HRM Department determines employee’s needs. This keeps employees happy, hardworking and motivated. It also leads to a stable workforce. This saves the organisation money.

Functions of the HRM Department
The HRM Department must plan how to best perform the following functions to support the organisation’s goals. The information is presented in the form of a flowchart:

Assess the need for new employees

Recruit and select new employees

Train new employees to meet current needs

Develop employee’s for future needs

Manage the employees performance

Compensate employee’s for their work

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Assess the employees performance

When employees leave, determine why

Each function is discussed in more depth on the next page.

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Assessing employee needs: the organisation must have enough employees to achieve its goals.

e.g. if a construction company has said it will finish building a new apartment block by the end of the summer it must have enough employees to do the work. If it doesn’t, the organisation will finish the building late. The organisation may be asked to make a penalty payment if it is late.

Recruit and select new employees: the organisation must employ the best people to do the job. This will help the organisation achieve its goals.

e.g. if you own a clothing store you want to employee staff who will have a good appearance, be honest and give good service. If you don’t find the right employees you might lose customers.

Train new employees: the organisation will need to train the new employees so that they are able to do their present job as well as possible. The employee is now able to help the organisation achieve its goals.

e.g. if you employee a new staff member to sell gold jewellery for your organisation, you will have to train them about the products. They need to know things like where the jewellery is made, the quality, the prices etc. If you don’t train new employees they might not be able to do the job properly. You will lose customers and get a bad reputation.

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Develop employees: the organisation will train the employee to meet the organisation’s needs in the future. This helps the organisation achieve its goals by planning for future needs.

e.g. if you know that you are going to upgrade your computer systems to new software next year you will train employees now to use the software. If you don’t train the employees in advance then they might not be able to give the service to customers you require. You will lose customers and get a bad reputation.

Manage employee performance: the organisation must ensure that the employee is motivated to be as productive as possible. This gets the best performance out of the employee, which helps the organisation to achieve its goals.

e.g. if your organisation is a car dealership, you want your salespeople to be motivated to sell cars. You must find ways to encourage them to do their best to give good service and sell as many cars as possible. If the employees aren’t motivated you won’t sell many cars and the organisation will not be successful.

Compensate employees: the organisation must determine the best ways in which to compensate, or pay, their employees. Compensation helps motivate employees to work hard, thus helping the organisation achieve its goals.

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e.g. some organisations offer bonuses to employees that work very hard. This gives the employees a reason to work harder. If there is no reason to work harder productivity will be low.

Assess performance: organisations need to assess employee’s performance. This is to identify training needs, decide who to promote or give a pay raise, and to determine the poor performing employees. This will ensure the employees are working to the best of their abilities, helping the organisation achieve its goals.

e.g. if you want to promote an employee you must know how well they are working. So, you assess their performance to determine their strengths and weaknesses.

Employees leaving: organisations invest a lot of time and money finding employees and then training them to meet their needs. So, when employees leave you want to find out why. This is called exit interviewing. Maintaining a stable workforce helps the organisation achieve its goals.

e.g. an employee leaves. In the exit interview you find out that your organisation is paying employees a lot less than other businesses. You can decide to increase how much you pay employees to stop them leaving.

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Task 1.5 Write a memo, in the format shown below using Microsoft Word, for employees in an organisation discussing:  the role of a Human Resource Management (HRM) Department  the benefits to the organisation of having a HRM department.


Task 1.6 Produce a flowchart using Microsoft Word showing the functions that the HRM department would have from the time that a vacancy is identified through to an employee leaving the organisation. Explain each function.

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To plan is to work out details beforehand. Planning is very important in our personal lives as well as at work. Some examples of planning are shown below:

Personal Planning The best way to drive to Dubai What courses to study at College What to do on the weekend

Work planning How many employees to recruit Where to open a new branch What training to give staff

Obviously, if you plan how to do something then you can decide on the best way to do it. Let’s look at the example of the best way to drive to Dubai. By planning the drive you can decide on the fastest way to go, where there is less traffic and the best places to stop for petrol. This will save you time and money. The trip will also be easier and more comfortable. Thus, you have achieved your objective (i.e. driving to Dubai) in the most efficient way.

Planning in business is like this. By planning you are able to manage your organisation more efficiently. This will then give you an advantage over your competitors. Let’s look at the example of how many employees to recruit. By planning you are able to decide how many new employees you will need in the future, based upon the plans you may have for expansion. This means that you will

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be able to take the time to find the best staff. It also means that you are able to give better customer service, as you will have enough staff to meet their needs. If you didn’t plan this in advance you may find that you don’t have enough employees, and you may be losing customers because they are not getting the service that they expect. Then you have to quickly find new employees, and there might not be any good employees available at the time. As you can see planning can help the organisation to achieve it’s goals, and not planning could mean that the goals are not achieved. Task 1.1 You are making plans about what to do this weekend. The things you want to do are shown on the next page. For each of them write what you must plan, or organise beforehand. Also write what would happen if you didn’t plan. An example is shown to help you:

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Plan Dinner at a restaurant

Things to organise  Book a table at the restaurant  Arrange transport to the restaurant

What happens if you don’t plan  You might not be able to get a table when you arrive  You might night be able to find a way to get to the restaurant

Go to the cinema

Get a hair cut

Fly to London

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The plans that we have looked at in the previous exercise have been to achieve personal goals. Let’s have a look at some work goals.

Task 1.2

Shown, on the next page, are examples of some things that need planning in an organisation. For each of them write what you must plan, or organise beforehand. Also write what would happen if you didn’t plan. An example is shown to help you:

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Plan Employee numbers

Things to organise  Calculate the number of new staff needed in the future  Recruitment of new employees

What happens if you don’t plan  You may have the wrong number of employees – too many costs you a lot of money, too few and your business will not run efficiently  You may not have time to find the best employees

Buy a new computer for your secretary

Open a new branch

Sell a new product

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Human resource planning

Correct planning is essential for all organisations. When making plans managers must decide the best way of doing things. Managers are responsible for their department in an organisation. Before the start of each year the manager must plan:  The goals for the department  How to best achieve these goals  How to organise the department to best achieve the goals  What resources are required (employees, equipment, finance)  The cost of running the department. This is known as the department’s budget If managers don’t plan correctly the goals of the department may not be achieved. When the HRM department is planning it will use a process. An example of a HRM planning process is shown below: 1. Forecasting – try and predict what your human resource needs may be. 2. Goal setting – decide what your goals are and when you want to achieve them by 3. Options – decide how to achieve these goals

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4. Implementation – implement the option decided upon to achieve the goals 5. Evaluation – were the goals achieved? How could the plan be improved? An example of a human resource planning process is shown below: Forecast  Employee numbers for next year  An extra 30 employees are needed Goal  Recruit 30 new employees  Recruit by November Options  Advertise in the newspaper  Conduct a panel interview Implementation  Place advertisements in the newspaper  Interview the best applicants  Offer the job to the best applicant Evaluation  Did the HRM Department find 30 new employees?  How could this process be improved?

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Task 1.3

You will be given a human resource planning template. Read the case study below and fill in what was forecast, what the goal was etc.

Saif is the Human Resource Manager for Arabtec Industries. In a meeting with the General Manager last year he was asked to determine what training employees needed for a computer upgrade. Saif asked the company supplying the software and forecast that all employees would need to do a 1 day training course. Saif went back to the General Manager who approved his proposal to train the 54 employees how to use the software by August.

Saif then phoned some computer training businesses to ask the cost of training the 54 employees. He decided to use Abdullas Computer Training School, as they had a good reputation and one of the best prices. Saif asked Abduls Computer Training School to conduct the training in June.

After the training Saif evaluated what the employees had learnt. He was very happy as they had all learnt how to use the software. He decided that he will use Abdullas Computer Training School again.

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Task 1.4

Hamad is the manager of the Finance Department in a large bank. Hamad was asked to make plans for his department for the next year. As he was very busy he didn’t take the time to think about what he needed to achieve his goals. He asked for the same budget as last year.

The bank ran a promotion through the year that attracted a lot of new customers. It was the Finance Departments job to open the new accounts and put all of the customer’s details into the computer. There were so many new customers that it was taking the Finance Department 2 weeks to open the new accounts. Many of the new customers then closed their accounts as they were dissatisfied with the length of time it was taking.

Hamad then decided he needed new employees to help with the work. Only 3 people applied and he employed 2 of them. He wasn’t happy with their qualifications or experience, he didn’t think they had enough of either, but he needed people that could start working immediately.

The new employees complained about not having computers, so Hamad had to buy them. There was a sale next month, but Hamad needed them straight away. Today Hamad was called into his manager’s office and fired. His manager said that Hamad had lost the organisation a lot of money by spending a lot more than he had budgeted for. The new employees were causing problems
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– they didn’t know how to do the work and they were causing fights with the other employees in the department. The manager was also very angry because the bank had lost a lot of customers because they were unhappy about the service from Hamad’s department. When Hamad said that they were very busy, his manager replied that Hamad was told that there was going to be a promotion to get new customers – why didn’t he plan for it? 1. Did Hamad make adequate plans for the coming year? 2. What resource requirements did Hamad have to plan for? RESOURCE Employees REQUIREMENTS



3. What were the effects of Hamad not planning employee requirements?

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4. What were the effects of Hamad not planning the equipment requirements?

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Consolidation task In pairs, produce a Human Resource Management Plan, in the form of a report, to be presented to management.

You are planning to increase employee numbers as your organisation It has been forecast that you’ll need 5 new employees, to begin work on the 1 January 2002.

Write the report in the format shown below:

Page 1

Title page

Page 2

Table of contents

Page 3


Page 4


Page 5


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Use the following explanations to help you compile your report. Title page  title of your report  names of members of group  date  who the report is for Table of contents Introduction  what is on each page  purpose of the report (ie what the report is about)  the role of the HRM department  benefits of a HRM department  what HRM planning is Body  what have you forecast?  what is your goal?  what options do you have to achieve this goal?  how will you implement these options?  how will you evaluate your plan? Conclusion  state the main points of the report

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5. What were the effects of Hamad not planning financial requirements?

6. What effect did Hamad not planning have on the organisation?

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