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Unit 1 of 4 · MBA Sem 2

Unit 1: HRM foundations and planning

Human Resource Management notes · PTU syllabus (MBA 204-18)

3 min read6 topics10 exam questions
On this page
  1. Unit summary
  2. Nature, scope, role and importance of HRM
  3. Evolution of HRM
  4. HR as a competitive advantage and strategic HRM
  5. HR environment scanning
  6. Human resource planning (HRP)
  7. Job analysis
  8. Key terms
  9. Quick revision
  10. Important questions

Unit summary

People are an organisation's most important and hardest-to-copy resource. This unit covers the nature, scope, objectives and functions of HRM, its evolution, HR as a source of competitive advantage, strategic HRM and its integration with business strategy, HR environment scanning, human resource planning, and job analysis, description and specification.

After this unit you can

  • Explain the nature, scope, objectives, functions and evolution of HRM
  • Explain HR as competitive advantage and strategic HRM
  • Explain HR environment scanning and the HRP process
  • Explain job analysis, job description and job specification

PTU syllabus topics

  • Nature
  • scope
  • objectives and functions of HRM
  • evolution of HRM
  • HR as competitive advantage
  • strategic HRM and its integration with business strategy
  • HR environment scanning
  • human resource planning process
  • job analysis
  • job description and specification
ProcessHR planning process
  1. 1

    Analyse business objectives

  2. 2

    Forecast demand for people

  3. 3

    Forecast supply

  4. 4

    Identify gaps

    Shortage or surplus

  5. 5

    Action plans

    Hire, train, redeploy

  6. 6

    Monitor

1

Topic 1

Nature, scope, role and importance of HRM

Human resource management is the process of acquiring, training, appraising and compensating employees and attending to their labour relations, health, safety and fairness (Dessler). Nature: people-oriented, pervasive, continuous, development-oriented and both a line and staff function.

ClassificationScope of HRM
HRM

  • Procurement

    HR planning, recruitment, selection, induction

  • Development

    Training, career planning

  • Compensation

    Wages, incentives, benefits

  • Maintenance

    Health, safety, welfare

  • Integration and relations

    Motivation, grievances, industrial relations

  • Separation

    Retirement, exit

Role of the HR manager: advisory, service, strategic partner, change agent and employee champion.

FrameworkFunctions of HRM

  • Managerial functions

    Planning, organising, directing, controlling the HR function

  • Operative functions

    Procurement, development, compensation, integration, maintenance, separation

  • Advisory functions

    Advising top management and line managers

  • Strategic functions

    Aligning people strategy with business strategy

2

Topic 2

Evolution of HRM

ProcessEvolution of HRM
  1. 1Welfare era (1900s–1940s)

    Labour welfare officers, Factories Act

  2. 2Personnel management (1950s–1970s)

    Administration, IR, compliance

  3. 3Human resource management (1980s)

    People as resources; integration of functions

  4. 4Strategic HRM (1990s)

    HR aligned with strategy

  5. 5Human capital and digital HR (2010s onwards)

    Analytics, employee experience, HR tech, gig workforce

3

Topic 3

HR as a competitive advantage and strategic HRM

  • Resource-based view: people are a source of sustained competitive advantage when their skills are valuable, rare, inimitable and organised (VRIO) — culture and know-how are hard to copy.
  • Strategic HRM: linking HR policies and practices with business strategy so that people capabilities drive goals.
ComparisonTraditional HRM vs strategic HRM
Traditional HRM
Strategic HRM

Focus

Employee relations, administration

Partnership with business, value creation

Time horizon

Short term

Long term

Role of HR

Specialist, staff function

Change leader, strategic partner

Responsibility

HR department

Line managers and HR together

  • Integration with business strategy: cost-leadership firms emphasise efficiency and tight job design; innovation firms emphasise creativity, autonomy and long-term development (Schuler and Jackson).
4

Topic 4

HR environment scanning

  • External environment: economy (labour supply and wages), technology (automation, AI), legal (labour codes), demography (young workforce, women participation), social values, globalisation, competition for talent.
  • Internal environment: strategy, structure, culture, unions, financial position.
  • Tools: PESTEL, SWOT, workforce analytics, benchmarking surveys.
5

Topic 5

Human resource planning (HRP)

HRP is the process of forecasting an organisation's future demand for and supply of the right type of people, in the right number, at the right time.

ProcessThe HRP process
  1. 1

    Analyse organisational plans and objectives

  2. 2

    Forecast demand for HR

    Workload analysis, trend analysis, managerial judgement

  3. 3

    Forecast supply of HR

    Internal (skills inventory, succession) and external

  4. 4

    Estimate the gap

    Shortage or surplus

  5. 5

    Action plans

    Recruitment, training, redeployment, downsizing

  6. 6

    Monitor and control

Factors affecting HRP: type and strategy of the organisation, environmental uncertainties, time horizon, nature of jobs, outsourcing and the quality of information.

6

Topic 6

Job analysis

Job analysis is the process of collecting and studying information about a job's duties, responsibilities, skills and working conditions.

ProcessSteps in job analysis
  1. 1

    Decide the purpose

  2. 2

    Select jobs to analyse

  3. 3

    Collect information

    Observation, interviews, questionnaires, diaries, critical incidents

  4. 4

    Process and verify information

  5. 5

    Prepare job description and specification

  6. 6

    Review periodically

ComparisonJob description vs job specification
Job description
Job specification

Describes

The job: title, duties, responsibilities, conditions

The person: qualifications, skills, experience, traits

Purpose

What the job involves

Who is suitable

Use

Orientation, appraisal

Recruitment and selection

Key terms

HRM
Acquiring, developing, rewarding and retaining people effectively
Strategic HRM
Aligning HR practices with business strategy
Human resource planning
Forecasting and matching HR demand and supply
Job description
Statement of duties and responsibilities of a job
Job specification
Qualifications and qualities required for a job

Quick revision

  • HRM functions: managerial, operative, advisory, strategic.
  • Evolution: welfare → personnel → HRM → strategic HRM → digital HR.
  • RBV: people as VRIO resources; Ulrich model for HR organisation.
  • Environment scanning: PESTEL for HR.
  • HRP process; job analysis → description and specification.

Important exam questions

Practice questions written to the PTU exam pattern for this unit's syllabus: short answers (Section A style) and long answers (Sections B and C style).

Short-answer questions

  1. Q1.Define HRM.
  2. Q2.What is strategic HRM?
  3. Q3.What is Ulrich's HR model?
  4. Q4.What is HR environment scanning?
  5. Q5.State the steps of HRP.
  6. Q6.Distinguish job description and job specification.

Long-answer questions

  1. Q1.Explain the nature, scope, objectives and evolution of HRM.
  2. Q2.Explain strategic HRM and HR as a source of competitive advantage.
  3. Q3.Explain the human resource planning process.
  4. Q4.Explain job analysis and its methods.

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