HR as a Source of Shareholder Value

HR as a Source of Shareholder Value

Companies with the best people management deliver nearly twice as much value to shareholders as their average competitors - Watson Wyatt Consultants

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 labour laws. In circumstances where employees desire and are legally authorized to hold a collective bargaining agreement, HR will typically also serve as the company's primary liaison with the employees' representatives. The human resource management traditional approach focuses on personnel functions such as recruitment, performance appraisals, payroll administration, and the like, with some employee-centric development initiatives such as training and development interventions, motivation initiatives

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Traditional View of HRM
• Traditionally HRM was considered as Salaried model. The traditional approach the human resource management was designed according to industrial environment, applicable to blue-collared factory workers, is a controlled work atmosphere marked by narrow, rigid job definitions and detailed workplace rules and procedures.

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Workers have much autonomy and deviating from the written policy and procedure attract disciplinary action, with discretion remaining an exclusive prerogative of management. The trade union dominates collective bargaining settlements define pay scales, and seniority decides promotion opportunities.

Traditional View of HRM
Focus on Functional Activities and Process Orientation  Human resource management traditional approaches focus on functional activities such as human resource planning, job analysis, recruitment and selection, maintaining employee relations, performance appraisals, compensation