System Model of HRM

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System Model of HRM

• System composed of interrelated interacting
  parts to achieve desired goals
• System approach to HRM combines itself with
  business strategy
• Many firms in developing countries are facing
  problems due to their traditional practices of
  managing people
• The system, functions, components and objectives
  of modern organizations differ from traditional
  organizations
• HRM system is linked with organization
  performance, organization structure and strategic
  objectives of the organization
• Open system consists of input-processing-output
  feedback components
• Operates within internal external environment

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HRM System

External Environment Factors Government law
regulation, Union, Eco condition,
Competitiveness, Composition of the labor force,
Geographical location of the organ, Tech.
Threats and Opportunities
Inputs Human Energy competencies Organizational
Plan HR Plan Mgmt Inventory Job Analysis Labour
Market

Processing Acquisition Development Ulitization Mai
ntenance
Outputs Organizational related output Employee
related output
Feedback

Internal Environment Factors Strategy, Goals,
Culture, Nature of the task, Group work, Leader's
style experience
Strengths and Weaknesses
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HRM System1. Inputs of HRM

• Human energy competencies (physical strength,
  knowledge, skills, attitudes, experiences etc.)
• Organizational plan (organizational goals,
  strategy, target)
• Human resource plan (matches future HR demand
  with supply indicates the HR requirements)
• Management inventory (record of HR currently
  available in the organization)
• Job analysis (specifies job requirements, job
  specifications)
• Labor market (source of external supply for
  quality human resources)

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HRM System2. Processing of HRM

• a. Acquisition
• Ensures entry of right number of people at the
  right place at the right time in the organization
• Consists of recruitment, selection
  socialization
• b. Development
• Ensures proper competencies of employees to
  handle jobs
• Analyzing development needs
• Employee training
• Management development
• Career development
• c. Utilization
• Ensures willingness of employees for boosting
  productivity by doing jobs effectively
• Consists of motivation, performance appraisal,
  compensation etc.
• d. Maintenance
• Ensures retention of competent employees in the
  organization
• Labor relations (employer-employee relations
  employee discipline, grievance handling)
• Employee welfare (to promote employee safety,
  health, social security, etc.)

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HRM System3. Output

• a. Organization-related outputs
• Goal-achievement
• Quality of work life (QWL) (Quality of
  relationship between employees the total
  working environment of the organization.)
• Mechanisms of QWL
• Learning development
• Recognition
• Autonomy
• Intrinsic/extrinsic rewards
• Productivity
• Profits
• Readiness for change
• b. Employee-related outputs
• Commitment (achieved through trust,
  understanding, communication, loyalty etc.)
• Competence (changes in the environment assume
  new roles)
• Congruence (related to goals, harmony between
  individual organizational goals)
• Cost effectiveness (high cost-effectiveness)

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HRM System

• 4. Feedback
• Provides information to redesign HRM inputs
  processing based on output effectiveness
• 5. Internal Environment
• Forces in the internal environment are
  controllable by HRM
• Provide strengths weaknesses
• They are organizational goals, policies,
  structure, reward system organizational culture
• 6. External Environment
• Forces non controllable by HRM
• Provide opportunities pose threats
• They are technology, politics/law, labour unions,
  economic forces, socio-cultural forces

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Internal External Environment of HRMA.
External environment (outside the organization)

• Government Law and Regulation
• Affects organization directly
• Decisions about hiring, promotion, diversity,
  evaluation, employment opportunity,
  discrimination, compensation, benefits
  regulation, safety laws etc.

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• Union
• An organization that represents the interests of
  employees
• Shapes the HR policies practices
• Union representatives are included in major HR
  decisions
• Recruiting, selection, promotion, compensation,
  etc.
• Not restricted only to the blue-collar workers

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• Economic Conditions
• Economic devt. of a country gives priority to the
  proper mgmt. of HR
• Provides career skill devt. opportunities
• Local companies compete with foreign ones thus
  local companies reform their work processes

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• Competitiveness
• Effective workers?
• Quality services or good?
• New technology?
• Lower cost products?
• HRM can be a competitive advantage

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• Composition Diversity of the Labor Force
• Women
• Minorities
• Older Employees

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• Geographical Location of the Organization
• Rural, urban area?
• Kinds of workers available
• Educational factors
• Behavioral factors (attitudes)
• Legal-political factors (stability, racists etc.)
• Economic factors (structure, inflation,
  constraints on ownership etc.)
• Socio-cultural factors

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• Technology
• Technology is a major factor in deciding about HR
  policy choices
• Use of sophisticated efficient technology
• Increased the quality volume of the
  products/services
• Reduced the price level
• Coping with the technological environment demands
  for knowledge workers

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B. Internal Environmental Influences

• Strategy
• What an organizations key executives hope to
  accomplish in the long run
• Selection of a particular HR strategy, policy
  practice
• Business firms differ in their HR strategy due to
  different business environment competitive
  strategy

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• Goals
• The goals of organizations differ within among
  departments
• Differences in the importance of goals
• E.g. profit goals are emphasized, HRM goals are
  paid only minimal attention

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• Organization Culture
• System of shared meaning held by members
• A firms way of doing business
• How it treats customers employees
• Autonomy of the departments
• Degree of employee loyalty expressed
• A common value system
• Strong or weak culture?
• Impact on the behavior, productivity,
  expectations of the employees
• E.g. clear guidelines on punctuality, customer
  service etc.

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• Nature of the Task
• Degree of knowledge ability to use IT
• Degree of empowerment
• Degree of physical exertion required
• Degree of environmental unpleasantness
• Physical location of work
• Time dimension of work
• Human interaction on the job
• Degree of variety in the task
• Task identity

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• Group Work
• Directly related to the success of HRM activities
• Work-group participation in designing
  implementing HRM is essential

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• Leaders Style and Experience
• Experiences leadership style of the operating
  manager affects HRM activities
• Direction, encouragement, authority to evoke
  desired behaviors
• Facilitates interactions that occur within work
  groups