HRM Study Notes

SEMESTER 2
(Notes useful for First Year & Semester 2 of MMS program of Mumbai University)

What is HRM?
Human resource management is the management of an organization's workforce, or human resources. It is responsible for the attraction, selection, training, assessment, and rewarding of employees, while also overseeing organizational leadership and culture, and ensuring compliance with employment and labor laws.

Objectives of HRM
To help the organization reach its goals. To ensure effective utilization and maximum development of human resources. To ensure respect for human beings. To identify and satisfy the needs of individuals. To ensure reconciliation of individual goals with those of the organization. To achieve and maintain high morale among employees. To provide the organization with well-trained and well-motivated employees. To increase to the fullest the employees job satisfaction and self-actualization. To develop and maintain a quality of work life. To be ethically and socially responsive to the needs of society. To develop overall personality of each employee in its multidimensional aspect. To enhance employees capabilities to perform the present job. To equip the employees with precision and clarity in transaction of business. To inculcate the sense of team spirit, team work and inter-team collaboration.

Functions of HRM
1. Human resource or manpower planning. 2. Recruitment, selection and placement of personnel. 3. Training and development of employees. 4. Appraisal of performance of employees. 5. Taking corrective steps such as transfer from one job to another. 6. Remuneration of employees. 7. Social security and welfare of employees. 8. Setting general and specific management policy for organizational relationship. 9. Collective bargaining, contract negotiation and grievance handling. 10. Staffing the organization. 11. Aiding in the self-development of employees at all levels. 12. Developing and maintaining motivation for workers by providing incentives. 13. Reviewing and auditing manpower management in the organization 14. Potential Appraisal. Feedback Counseling. 15. Role Analysis for job occupants. 16. Job Rotation. 17. Quality Circle, Organization development and Quality of Working Life.

Scope of HRM
1. Personnel aspect-This is concerned with manpower planning, recruitment, selection, placement, transfer, promotion, training and development, layoff and retrenchment, remuneration, incentives, productivity etc. 2. Welfare aspect-It deals with working conditions and amenities such as canteens, creches, rest and lunch rooms, housing, transport, medical assistance, education, health and safety, recreation facilities, etc. 3. Industrial relations aspect-This covers union-management relations, joint consultation, collective bargaining, grievance and disciplinary procedures, settlement of disputes, etc.

Nature of HRM
Human Resource Management is a process of bringing people and organizations together so that the goals of each are met. The various features of HRM include: It is pervasive in nature as it is present in all enterprises. Its focus is on results rather than on rules. It tries to help employees develop their potential fully. It encourages employees to give their best to the organization. It is all about people at work, both as individuals and groups. It tries to put people on assigned jobs in order to produce good results. It helps an organization meet its goals in the future by providing for competent and well-motivated employees. It tries to build and maintain cordial relations between people working at various levels in the organization. It is a multidisciplinary activity, utilizing knowledge and inputs drawn from psychology, economics, etc.

Personnel Department
The department responsible for hiring and training and placing employees and for setting policies for personnel management

Personnel Policies
Personnel policies, also called employee handbooks, are a set of statements that explain what the employer expects from its employees and what employees may expect from the employer. Policies offer guidelines for decision-making and reflect a business' values. The policies should include comprehensive information about workplace rules; for example, hours, attendance, pay, benefits, supervision and discipline. Eg: Policy of hiring, terms and conditions of employment, medicals, leaves, housing, transport. Discrimination and Harassment Discrimination and harassment policies are often included in a personnel manual; copies are often provided to new hires during orientation to read and sign for placement in their personnel files. These policies may include instructions for reporting discrimination and harassment. In addition, the policies are often displayed on the organizations website or Intranet. Hiring and New Employees Hiring policies include instructions for posting vacancies, the application and interview process, acceptable documentation for applicants, offers of employment and employment discrimination policies. New employee processing may require the use of a checklist to ensure completion of all tasks. Orientation may include discussion of probationary periods and employment status, such as at-will, temporary or permanent. The policy may list the documents new employees must read and sign, and the contents required for new employee files. Work Schedule and Leave Work schedule policies may specify strict work schedules, allowable flexible schedules, and specify lunch and break period requirements. Company leave policies may include the companys annual paid holidays, the amount and allowable use of personal and sick leave, and the amount of vacation time provided and how that time is earned. Policies may include leaves of absence, leave for adverse weather conditions, the Family Medical Leave Act, jury duty and leave for military or reserve duty. Compensation Compensation policies may include employee classification, salary ranges, requirements for promotions or salary raises, payment of overtime, salary advances and required and voluntary payroll deductions. The policies may also include timekeeping requirements such as the required forms and signatures, the pay period, pay days, payment types and payment methods, such as direct deposit.

Benefits Benefit policies include employee eligibility for company benefits such as health, life, and disability insurance; retirement accounts; and other company benefits such as childcare or tuition reimbursement. Benefits also include company policies for extending COBRA benefits to separated employees. Benefits may describe the workers' compensation policy, including legal requirements, company procedures for reporting and responding to accidents and injuries, required forms and coverage of medical expenses. Performance Appraisal Company policies for performance appraisals are often related to compensation, and usually detail how appraisals affect salary increases. The policies include the appraisal cycles and processes, who performs the appraisals, the appropriate forms, required conferences with the employee undergoing appraisals, and what is covered in the appraisal, such as leave use, disciplinary issues and overall job performance. Termination of Employment Policies concerning separated employees include the processes for employee resignation, suspension and termination. Policies usually state the length of notice resigning employees should provide to the company. Policies include the reasons an employee may be suspended, the process to be followed and how compensation is affected. Termination policies often include requirements for a process that involves documentation of infractions and corrective measures leading to termination. Grievance Company grievance policies provide instruction for employees to file official complaints to supervisors or management. The process often describes a method that involves submitting complaints through a hierarchy of supervision and management and may address complaints of discrimination, harassment or other conflicts. The policy describes the process for making a determination, the appeals process and possible resolutions.

Fiscal Management Financial or fiscal policies may cover budget management, reporting, reimbursement of personal expenses such as travel, use of company credit cards or accounts, authorization for expenditures, requesting and ordering supplies and equipment, forms, recordkeeping and procedures.

Confidentiality Companies use confidentiality policies to protect the privacy of employees, clients and company records. Policies may include disclosure prohibitions, instructions for disposal or destruction of records, restrictions for access to certain records and release of information, appropriate use of email and correspondence and prohibited communication.

Human Resource Planning

Human Resource Planning is a process to determine future staffing needs by analyzing organization future business plan and in consideration employee turnover within the organization. Through planning process, a management strives to have right number of workforce and the right kinds of people at the right locations, at right time in order to fulfill the obligations for the benefit of organization as well as individual.

Importance of Human Resource Planning

1. It improves the utilisation of human resources by helping the management forecast the recruitment needs in terms of both numbers as well as the types of skills required and develop ways to avoid or correct problems before they become serious and disrupt operations. 2. It helps focus the recruitment efforts on the most likely sources of supply. This will cut down total costs or hiring and training personnel and reduce costs associated with hiring mistakes 3. It makes provisions for replacement or backup staff from either inside or outside the organisation wherever the need arises either on a temporary or permanent basis. These available sources of supply are important to identify, specify in the case of any emergencies that might occur. 4. It helps achieve an integration of personnel plans with other operating as well' as strategic plans by making available the personnel management information base to other organisational activities.

Objectives of Human Resource Planning

1. To ensure proper utilization of human resources. 2. To check the development of the employees for the achievement of the organization goal. 3. To ensure proper human resource policies. 4. To provide proper control measures whenever required.

Scope of Human Resource Planning

1. To make the list of current manpower. 2. To check how much current manpower is being utilized. 3. To find out how much manpower is required. 4. To make manpower procurement plans. 5. To make the training programmes.

Human Resource Forecasting

The prediction of future levels of demand for, and supply of, workers and skills at organizational, regional, or national level. A variety of techniques are used in manpower forecasting, including the statistical analysis of current trends and the use of mathematical models. At national level, these include the analysis of census statistics; at organizational level, projections of future requirements may be made from sales and production figures. Human resource forecasting forms part of the human resource planning process.

Human Resource Forecasting Techniques

Zero Based Forecasting This method uses the organizations current level of employment as the starting point for determining future staffing needs. The key to zero-base forecasting is a thorough analysis of human resource needs. Bottom-Up Approach A forecasting method in which each successive level of the organization, starting with the lowest, forecasts its employee requirements in order to, ultimately, provide an aggregate forecast of employment needs. Use of Mathematical Models Mathematical models can assist in forecasting HR requirements. The relationship between sales demand and the number of employees needed is a positive one. Simulation Simulation is a technique for experimenting with a real-world situation through a mathematical model representing that situation. A model is an abstraction of the real world.

Importance of Human Resource Planning

Provides quality workforce One of the Importance of Human Resource Planning is that effective Human Resource Planning fulfills the organization needs for a quality workforce. Quality workforce aids in giving a company a competitive advantage over its rivals. Reduces labor costs Another Importance of Human Resource Planning is that a proper Human Resource plan reduces labor costs substantially by maintaining a balance between demand for and supply of HR i.e. works as a cost saving device for the company. Facilitates rise in skills Another Importance of Human Resource Planning is that it facilitates the rise in skills, abilities and potential of the workforce through training and development. Training employees helps them improve in their working capacity thus tend to develop to a quality workforce. Effective motivation Effective motivation is another Importance of Human Resource Planning. An effective Human Resource Plan provides multiple gains to the employee by way of promotions, increase in salary and other fringe benefits. This definitely boosts employee morale. Safety of health Another Importance of Human Resource Planning is safety of health. It provides for welfare, health and safety of its employees thus leads to an increase in productivity of the employees in the long run.

Job Analysis
Job analysis is the systematic study of jobs to identify the observable work activities, tasks, and responsibilities associated with a particular job or group of jobs.

Advantages of Job Analysis

1. Job analysis helps the personnel manager at the time of recruitment and selection of right man on right job. 2. It helps him to understand extent and scope of training required in that field. 3. It helps in evaluating the job in which the worth of the job has to be evaluated. 4. In those instances where smooth work force is required in concern. 5. When he has to avoid overlapping of authority- responsibility relationship so that distortion in chain of command doesnt exist. 6. It also helps to chalk out the compensation plans for the employees. 7. It also helps the personnel manager to undertake performance appraisal effectively in a concern. The Job Analysis is carried out in two ways 1. Job Description 2.Job Specification

Job Description:
It is an organized factual statement of job contents in the form of duties and responsibilities of a specific job. The preparation of job description is very important before a vacancy is advertised. It tells in brief the nature and type of job. This type of document is descriptive in nature and it constitutes all those facts which are related to a job such as: a. b. c. d. e. f. Title/ Designation of job and location in the concern. The nature of duties and operations to be performed in that job. The nature of authority- responsibility relationships. Necessary qualifications those are required for job. Relationship of that job with other jobs in a concern. The provision of physical and working condition or the work environment required in performance of that job.

Job Specification
It is a statement which tells us minimum acceptable human qualities which helps to perform a job. Job specification translates the job description into human qualifications so that a job can be performed in a better manner. Job specification helps in hiring an appropriate person for an appropriate position. The contents are: a. b. c. d. e. f. g. Job title and designation Educational qualifications for that title Physical and other related attributes Physique and mental health Special attributes and abilities Maturity and dependability Relationship of that job with other jobs in a concern.

Advantages of Job Specification

a. b. c. d. e. f. It is helpful in preliminary screening in the selection procedure. It helps in giving due justification to each job. It also helps in designing training and development programmes. It helps the supervisors for counseling and monitoring performance of employees. It helps in job evaluation. It helps the management to take decisions regarding promotion, transfers and giving extra benefits to the employees.

Job Evaluation
An assessment of the relative worth of various jobs on the basis of a consistent set of job and personal factors, such as qualifications and skills required. The objective of job evaluation is to determine which jobs should get more pay than others. Several methods such as job ranking, job grading, and factor comparison are employed in job evaluation. Research indicates, however, that each method is nearly as accurate and reliable as the other in ranking and pricing different jobs. Job evaluation forms the basis for wage and salary negotiations.

Advantages of Job Evaluation

1. Reduction in inequalities in salary structure - It is found that people and their motivation is dependent upon how well they are being paid. Therefore the main objective of job evaluation is to have external and internal consistency in salary structure so that inequalities in salaries are reduced. 2. Specialization - Because of division of labor and thereby specialization, a large number of enterprises have got hundred jobs and many employees to perform them. Therefore, an attempt should be made to define a job and thereby fix salaries for it. This is possible only through job evaluation. 3. Helps in selection of employees - The job evaluation information can be helpful at the time of selection of candidates. The factors that are determined for job evaluation can be taken into account while selecting the employees. 4. Harmonious relationship between employees and manager - Through job evaluation, harmonious and congenial relations can be maintained between employees and management, so that all kinds of salaries controversies can be minimized. 5. Standardization - The process of determining the salary differentials for different jobs become standardized through job evaluation. This helps in bringing uniformity into salary structure. 6. Relevance of new jobs - Through job evaluation, one can understand the relative value of new jobs in a concern.

Job Evaluation Methods a. Ranking method:

Raters examine the description of each job being evaluated and arrange the jobs in order according to their value to the company. This method requires a committee typically composed of both management and employee representative to arrange job in a simple rank order from highest to lowest. The committee members merely compare two jobs and judge which one is more important, or more difficult to perform. Then they compare the other job with the first two, and so on until all the jobs have been evaluated and ranked. The most obvious limitation to the ranking method is its sheer inability to be managed when there are a large number of jobs. Other drawbacks to be considered are the subjectivity of the method- there are no definite or consistent standards by which to justify the rankings- and the fact that because jobs are only ranked in terms of order, we have no knowledge of the distance between the ranks.

b. Classification method:
A job evaluation method by which a number of classes or grades are defined to describe a group of jobs is known as Classification method. The classifications are created by identifying some common denominator skills, knowledge, responsibilities with the desired goal being the criterion of a number of distinct classes or grades of jobs. Once the classifications are established, they are ranked in an overall order of importance according to the criteria chosen, and each job is placed in its appropriate classification. This later action is generally done by comparing each positions job description against the classification description and benchmarked jobs. The classification method shares most of the disadvantages of the ranking approach, plus the difficulty of writing classification descriptions, judging which jobs go where, and dealing with jobs that appear to fall into more than one classification.

c. Factor comparison method:

Raters need not keep the entire job in mind as they evaluate; instead, they make decisions on separate aspects, or factors, of the job. A basic underlying assumption is that there are five universal job factors: (1) Mental Requirements, (2) Skills, (3) Physical Requirements, (4) Responsibilities, and (5) Working Conditions. The committee first rank each of the selected benchmark jobs on the relative degree of difficulty for each of the five factors. Then, the committee allocates the total pay rates for each job to each factor based on the importance of the respective factor to the job. A job comparison scale, reflecting rankings and money allocations, is developed next. The raters compare each job, factor by factor, with those appearing on the job comparison scale. Then, they place the jobs on the chart in an appropriate position.

d. Point method:
Raters assign numerical values to specific job components, and the sum of these values provides a quantitative assessment of a jobs relative worth. The point method requires selection of job factors according to the nature of the specific group of jobs being evaluated. After determining the group of jobs to be studied, analysts conduct job analysis and write job descriptions. Next, the analysts select and define the factors to be used in measuring job value and which become the standards used for the evaluation of jobs. Education, experience, job knowledge, mental effort, physical effort, responsibility, and working conditions are examples of factors typically used. The committee establishes factor weights according to their relative importance in the jobs being evaluated, and then determines the total number of points to be used in the plan. A distribution of the point values to job factor degrees is made, with the next step being the preparation of a job evaluation manual.

Recruitment
Recruitment Policy
A recruitment policy governs the way an employer attempts to fill vacant staff positions. Most large companies have some form of recruitment policy in place that complies with employment laws, and also provides the company with a costefficient method to quickly replace outgoing employees. Major firms typically have hiring policies in place that all human resources personnel and hiring managers must abide by. Small firms with few employees usually handle recruitment on a case-by-case basis.

Objectives of Recruitment
Recruitment fulfills the following objectives: 1. It reviews the list of objectives of the company and tries to achieve them by promoting the company in the minds of public. 2. It forecasts how many people will be required in the company. 3. It enables the company to advertise itself and attract talented people. 4. It provides different opportunities to procure human resource.

Methods of Recruitment: Internal Sources

Internal sources of recruitment refer to obtaining people for job from inside the company. There are different methods of internal recruitment: 1. Promotion Companies can give promotion to existing employees. This method of recruitment saves a lot of time, money and efforts because the company does not have to train the existing employee. Since the employee has already worked with the company. He is familiar with the working culture and working style. It is a method of encouraging efficient workers. 2. Departmental examination This method is used by government departments to select employees for higher level posts. The advertisement is put up on the notice board of the department. People who are interested must send their application to the HR department and appear for the exam. Successful candidates are given the higher level job. The method ensures proper selection and impartiality. 3. Transfer Many companies adopt transfer as a method of recruitment. The idea is to select talented personnel from other branches of the company and transfer them to branches where there is shortage of people. 4. Retirement Many companies call back personnel who have already retired from the organization. This is a temporary measure. The method is beneficial because it gives a sense of pride to the retired when he is called back and helps the organization to reduce recruitment selection and training cost.

5. Internal advertisement In this method vacancies in a particular branch are advertised in the notice board. People who are interested are asked to apply for the job. The method helps in obtaining people who are ready to shift to another branch of the same company and it is also beneficial to people who want to shift to another branch.

6. Employee recommendation In this method employees are asked to recommend people for jobs. Since the employee is aware of the working conditions inside the company he will suggest people who can adjust to the situation. The company is benefited because it will obtain.

External Sources
External sources of recruitment refer to methods of recruitment to obtain people from outside the company. These methods are: 1. Management consultant Management consultant helps the company by providing them with managerial personnel, when the company is on the lookout for entry level management trainees and middle level managers. They generally approach management consultants. 2. Employment agencies Companies may give a contract to employment agencies that search, interview and obtain the required number of people. The method can be used to obtain lower level and middle level staff. 3. Campus recruitment When companies are in search of fresh graduates or new talent they opt for campus recruitment. Companies approach colleges, management, technical institutes, make a presentation about the company and the job and invite applications. Interested candidates who have applied are made to go through a series of selection test and interview before final selection. 4. News paper advertisement This is one of the oldest and most popular methods of recruitment. Advertisements for the job are given in leading news papers; the details of the job and salary are also mentioned. Candidates are given a contact address where their applications must be sent and are asked to send their applications within a specified time limit. The method has maximum reach and most preferred among all other methods of recruitment. 5. Internet advertisement With increasing importance to internet, companies and candidates have started using the internet as medium of advertisement and search for jobs. There are various job sites like naukri.com and monster.com etc. candidates can also post their profiles on these sites. This method is growing in popularity. 6. Walk in interview Another method of recruitment which is gaining importance is the walk in interview method. An advertisement about the location and time of walk in interview is given in the news paper. Candidates require to directly appearing for the interview and have to bring a copy of their C.V. with them. This method is very popular among B.P.O and call centers.

Selection
Selection can be defined as process of choosing the right person for the right job from a pool of different candidates who applied for a certain job.

Selection Process
The process of selection is not the same in all organizations; it can be different in many organizations depending upon the nature of that organization. However, one particular type of selection is approved by most organizations; it can be explain with the help of following diagram: 1. Job analysis The very first step in the selection procedure is the job analysis. The HR department prepares the job description and specification for the jobs which are vacant. This gives details for the jobs which are vacant. This gives details about the name of the job, qualification, qualities required and work conditions etc. 2. Advertisement Based on the information collected in step 1, the HR department prepares an advertisement and publishes it in a leading news papers. The advertisement conveys details about the last date for application, the address to which the application must be sent etc. 3. Application blank/form Application blank is the application form to be filled by the candidate when he applies for a job in the company. The application blank collects information consisting of the following four parts: 1. Personal details 2. Educational details 3. Work experience 4. Family background 4. Written test The applications which have been received are screened by the HR department and those applications which are incomplete are rejected. The other candidates are called for the written test. Arrangement for the written test is looked after the HR department i.e. question papers, answer papers, examination centers and hall tickets etc. 5. Interview Candidates who have successfully cleared the test are called for an interview. The entire responsibility for conducting the interview lies with the HR department i.e. they look after the panel of interviewers, refreshments, informing candidates etc. 6. Medical examination The candidates who have successfully cleared the interview are asked to take a medical exam. This medical exam may be conducted by the organization itself (army). The organization may have a tie up with the hospital or the candidate may be asked to get a certificate from his family doctor. 7. Initial job offer

Candidates who successfully clear the medical exam are given an initial job offer by the company stating the details regarding salary, terms of employment, employment bond if any etc. The candidate is given some time to think over the offer and to accept or reject. 8. Acceptance/ rejection Candidates who are happy with the offer send their acceptance within a specified time limit to show that they are ready to work with the company. 9. Letter of appointment/final job offer Candidates who send their acceptance are given the letter of appointment. The letter will state the name of the job. The salary and other benefits, number of medical leaves and casual leaves, details of employment bond if any etc. It will also state the date on which the employee is required to start duty in the company. 10. Induction On the date of joining the employee is introduced to the company and other employees through am elaborate induction program.

Types of Selection Tests

Different selection test are adopted by different organization depending upon their requirements. These tests are specialized test which have been scientifically tested and hence they are also known as scientific test. Different types of test can be explained with the help of following diagram: 1. Aptitude test Aptitude tests are test which assess the potential and ability of a candidate. It enables to find out whether the candidate is suitable for the job. The job may be managerial technical or clerical. The different types of aptitude test are the following: a) Mental ability/mental intelligence test This test is used to measure the overall intelligence and intellectual ability of the candidate to deal with problems. It judges the decision making abilities. b) Mechanical aptitude test This test deals with the ability of the candidate to do mechanical work. It is used to judge and measure the specialized knowledge and problem solving ability. It is used for technical and maintenance staff. c) Psycho motor test This test judges the motor skills the hand and eye co-ordination and evaluates the ability to do jobs lie packing, quality testing, quality inspection etc. 2. Intelligence test This test measures the numerical skills and reasoning abilities of the candidates. Such abilities become important in decision making. The test consists of logical reasoning ability, data interpretation, comprehension skills and basic language skills. 3. Personality test In this test the emotional ability or the emotional quotient is tested. This test judges the ability to work in a group, inter personal skills, ability to understand and handle conflicts and judge motivation levels. This test is becoming very popular now days. 4. Performance test This test judges and evaluates the acquired knowledge and experience of the knowledge and experience of the individual and his speed and accuracy in performing a job. It is used to test performance of typist, data entry operators etc.

Induction and Placement

Induction can be defined as a process of introducing the employee who is newly elected to the organization. When an employee is given a letter of appointment he joins the company on duty. The very first thing that the company does is, introduces the new employee to the organization and people working there. An induction program may be conducted at a particular center for all employees or at different places (branches of the company) for different employees. The induction starts with an introduction secession about the company, number of branches, a brief history of the company, number of products, number of countries operating in, organizational structure, culture, values, beliefs, the names of top management personnel etc. Apart from this introductory secession there will be other secessions also like secessions on behavioral science, soft skill training, secessions on giving details about the job, salary, bonus, information about different leaves that can be taken by the employee about upward mobility in the organization etc. There are different ways in which secessions can be conducted i.e. using lecture method, power point presentation, group discussion, psychological test, roll play secessions etc. The induction program concludes with the employee reporting for duty at his respective branch after induction. When he reports for duty the senior most people in the branch takes the new employee around the office and introduces to all other employees and gives information about the working of the branch. The senior people regularly stay in touch with the new employee in the first week so that he can make the new employee comfortable and help him to adjust to the company. After this the company may start a training program for the new employee.

Training and Development

Training
Most organisations look at training and development as an integral part of the human resource development activity. The turn of the century has seen increased focus on the same in organisations globally. Many organisations have mandated training hours per year for employees keeping in consideration the fact that technology is deskilling the employees at a very fast rate. So what is training and development then? Is it really that important to organisational survival or they can survive without the former? Are training and development one and the same thing or are they different? Training may be described as an endeavor aimed to improve or develop additional competency or skills in an employee on the job one currently holds in order to increase the performance or productivity. Technically training involves change in attitude, skills or knowledge of a person with the resultant improvement in the behaviour. For training to be effective it has to be a planned activity conducted after a thorough need analysis and target at certain competencies, most important it is to be conducted in a learning atmosphere. While designing the training program it has to be kept in mind that both the individual goals and organisational goals are kept in mind. Although it may not be entirely possible to ensure a sync, but competencies are chosen in a way that a win-win is created for the employee and the organisation. Typically organisations prepare their training calendars at the beginning of the financial year where training needs are identified for the employees. This need identification called as training need analysis is a part of the performance appraisal process. After need analysis the number of training hours, along with the training intervention are decided and the same is spread strategically over the next year.

Development
Lots of time training is confused with development, both are different in certain respects yet components of the same system. Development implies opportunities created to help employees grow. It is more of long term or futuristic in nature as opposed to training, which focus on the current job. It also is not limited to the job avenues in the current organisation but may focus on other development aspects also. At Goodyear, for example, employees are expected to mandatorily attend training program on presentation skills however they are also free to choose a course on perspectives in leadership through literature. Whereas the presentation skills program helps them on job, the literature based program may or may not help them directly. Similarly many organisations choose certain employees preferentially for programs to develop them for future positions. This is done on the basis of existing attitude, skills and abilities, knowledge and performance of the employee. Most of the leadership programs tend to be of this nature with a vision of creating and nurturing leaders for tomorrow. The major difference between training and development therefore is that while training focuses often on the current employee needs or competency gaps, development concerns itself with preparing people for future assignments and responsibilities.

Methods of Training
There are various methods of training, which can be divided in to cognitive and behavioral methods. Trainers need to understand the pros and cons of each method, also its impact on trainees keeping their background and skills in mind before giving training. Cognitive methods are more of giving theoretical training to the trainees. The various methods under Cognitive approach provide the rules for how to do something, written or verbal information, demonstrate relationships among concepts, etc. These methods are associated with changes in knowledge and attitude by stimulating learning.
The various methods that come under Cognitive approach are:

Lectures Demonstrations Discussions Computer Based Training (CBT) Intelligent Tutorial System(ITS) Programmed Instruction (PI) Virtual Reality

Behavioral methods are more of giving practical training to the trainees. The various methods under Behavioral approach allow the trainee to behavior in a real fashion. These methods are best used for skill development. The various methods that come under Behavioral approach are:

Games And Simulations Behavior-Modeling Business Games Case Studies Equipment Stimulators In-Basket Technique Role Plays

Both the methods can be used effectively to change attitudes, but through different means. Another Method is MANAGEMENT DEVELOPMENT METHOD MANAGEMENT DEVELOPMENT The more future oriented method and more concerned with education of the employees. To become a better performer by education implies that management development activities attempt to instill sound reasoning processes. Management development method is further divided into two parts:

ON THE JOB TRAINING The development of a manager's abilities can take place on the job. The four techniques for on the job development are:

Coaching Mentoring Job Rotation Job Instruction Technique (JIT)

OFF THE JOB TRAINING There are many management development techniques that an employee can take in off the job. The few popular methods are:

Sensitivity Training Transactional Analysis Straight Lectures/ Lectures Simulation Exercises

Evaluation of Training Program

A training program should give following resulting changes: 1. Reaction Reaction refers to attitude of employee about the training, whether the employee considers training to be positive or negative one. If reaction is positive then people have accepted the program and changes will be possible. 2. Learning Another method of judging effectiveness is to identify levels of learning i.e. how much the people have learnt during the training. This can be found out by trainers mark sheet, the report submitted by the employee, and actual performance. 3. Behavior The HR department needs to understand behavior of the employees, to understand the effectiveness of training. The behavioral change can be seen in how the person interacts with juniors, peer groups and seniors. They mark change in behavior and inform the HR department of the success of training program. 4. Result Results provided by employee in monetary terms also determines effectiveness of training program i.e. employee success in handling the project, the group performance before and after training etc.

Performance Appraisal
Performance appraisal may be conducted once in every 6 months or once in a year. The basic idea of the appraisal is to evaluate the performance of the employee, giving him a feed back. Identify areas where improvement is required so that training can be provided. Give incentives and bonus to encourage employees etc.

Methods of Performance Appraisal 1. Check list method

In this method the senior, the boss is given a list of questions about the junior. These questions are followed by check boxes. The superior has to put a tick mark in any one of the boxes. This method can be explained with the following example:

As seen in the above example, A questioner containing questions is given to the senior. This method is an extremely simple method and does not involve a lot of time. The same set of questioners can be given foe every employee so that there is uniformity in selecting employee.

2. Confidential report
This method is very popular in government departments to appraise IAS officers and other high level officials. In this method the senior or the boss writes a report about the junior giving him details about the performance about the employee. The positive and negative traits, responsibilities handled on the job and recommendations for future incentives or promotions. The report is kept highly confidential and access to the report is limited.

3. Critical incident method

In this method critical or important incidents which have taken place on this job are noted down along with employees behavior and reaction in all these situations. Both positive and negative incidents are mentioned. This is followed by an analysis of the person, his abilities and talent, recommendations for the future incentives and promotions.

4. Ranking method
In this method ranks are given to employees based on their performance. There are different methods of ranking employees: Simple ranking method Alternate ranking method Paired comparison method Simple ranking method Simple ranking method refers to ranks in serial order from the best employee, for example: If we have to rank 10 best employees we start with the first best employee and give him the first rank this is followed by the 2nd best and so on until all 10 have been given ranks. Alternate ranking In this method the serial alternates between the best and the worst employee. The best employee is given rank 1and then we move to the worst employee and give him rank 10 again to 2nd best employee and give him rank 2 and so on. iii. Paired comparison In this method each and every person is the group, department or team is compared with every other person in the team/group/department. The comparison is made on certain criteria and finally ranks are given. This method is superior because it compares each and every person on certain qualities and provides a ranking on that basis.

5. Graphic rating scale

Graphic rating scale refers to using specific factors to appraise people. The entire appraisal is presented in the form of a chart. The chart contains certain columns which indicate qualities which are being appraised and other columns which specify the rank to be given. The senior has to put a tick mark for a particular quality along with the ranking. Such charts are prepared for every employee. According to the department in which they work. Sometimes the qualities which are judged may change depending upon the department. 6. Narrated essay In this method the senior or the boss is supposed to write a narrative essay describing the qualities of his junior. He may describe the employees strength and weakness, analytical abilities etc. The narrative essay ends with a recommendation for future promotion or for future incentives.

Modern Methods 1. Role analysis

In this method of appraisal the person who is being apprised is called the focal point and the members of his group who are appraising him are called role set members. These role set members identify key result areas (KRA 2 marks) (areas where you want improvement are called KRA) which have to be achieved by the employee. The KRA and their improvement will determine the amount of incentives and benefits which the employee will receive in future. The appraisal depends upon what role set members have to say about the employee.

2. Assessment centers
Assessment centers (AC) are places where the employees are assessed on certain qualities talents and skills which they possess. This method is used for selection as well as for appraisal. The people who attend assessment centers are given management games, psychological test, puzzles, questioners about different management related situations etc. based on their performance in these test an games appraisal is done.

3. Management by objective
This method was given by Peter Drucker in 1974. It was intended to be a method of group decision making. It can be use for performance appraisal also. In this method all members of the of the department starting from the lowest level employee to the highest level employee together discus, fix target goals to be achieved, plan for achieving these goals and work together to achieve them. The seniors in the department get an opportunity to observe their junior- group efforts, communication skills, knowledge levels, interest levels etc. based on this appraisal is done.

4. Behavioral anchored rating scale

In this method the appraisal is done to test the attitude of the employee towards his job. Normally people with positive approach or attitude view and perform their job differently as compared to people with a negative approach.

5. Psychological testing
In this method clinically approved psychological test are conducted to identify and appraise the employee. A feedback is given to the employee and areas of improvement are identified. 6. Human resource audit/accounting In this method the expenditure on the employee is compared with the income received due to the efforts of the employee. A comparison is made to find out the utility of the employee to the organization. The appraisal informs the employee about his contribution to the company and what is expected in future.

7. 360* appraisal
In this method of appraisal and all round approach is adopted. Feedback about the employee is taken from the employee himself, his superiors, his juniors, his colleagues, customers he deals with, financial institutions and other people he deals with etc. Based on all these observations an appraisal is made and feedback is given. This is one of the most popular methods.

Process of Performance Appraisal

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