HUMAN RESOURCE MANAGEMENT AT MYSTIC MONK DESIGNS GARMENT
We start with defining what you mean by human resources? According to Leon C. Megginson, the term human resources ca be thought of as, “the total knowledge, skill, creative abilities, talent and aptitudes of an organization’s workforce, as well as the value, attitudes and beliefs of the individuals involved” Human resources are also regarded as human factor, human asset, human capital and the like. Nature and Scope of Human Resources in Organization People in any organization manifest themselves, not only through individual sections but also through group interactions. When individuals come to work place, they come with not only technical skills, knowledge etc. But also with their personal feelings, perception, desire motives, attitude, values etc. Therefore employee management in an organization does not mean management of not only technical skills but also other factors of the human resources Complex Dynamism The handling of human resource is entirely different from that of other resources. If human factor is properly utilizes, it may even prove a dynamic motive force for running an organization. Otherwise it becomes a passive and destructive force. A Social System The personnel manager involves himself in administering a social system. In this process, the manager has to see that the economic 1
satisfaction for a reasonable livelihood, the social satisfaction of working together as members of a group and individual job satisfaction of a worker are attained. The nature and significance of personnel management have undergone rapid changes recognizing the people not as a cost center but as a profit center. Meaning of Human Resource Management In simple sense, human resources management means employing people, developing their resources, utilizing, maintaining and compensating their services in tune with job and organizational requirements. Michael J. Jucius defined Personnel Management as “the field of management Personnel Management as “the field of management which has to do with planning, organizing, directing and controlling the functions of procuring, developing, maintaining and utilizing a labor force, such that the : a) Objectives for which the company is established are attained economically and effectively, b) Objectives of all levels of personnel are served to the highest possible degree, c) Objectives of society are dully considered and served Human Resource Management can be defined as managing (planning, organizing, directing and controlling) the functions of employing,
developing
and
compensating
human
resources
resulting in the creating and development of human relations with a view
to
contribute
proportionately
(due
organizational individual and social goals. 2
to
them)
to
the
Significance of Human Resource Management (HRM) Today the apparel industry has become very competitive with the removal of quotas more and more buyers are coming into India. Human resources are the lifelines of any organization. Human
Resources
System
is
a
central
subsystem
of
the
organization. Human resources system in an organization is not only unique subsystem but also a principle and central sub-system and it operates upon and control all other systems (as shown in the following figure.
Organisation System
Material SubSystem
Financial SubSystem
Human Resources Sub-System
Marketing SubSystem
Technolo gy SubSystem Thus in the words of Wendell L. French, “ Personnel management is a major pervasive sub-system of all organizations”. Whatever I the environment affects the organization like economic, social, cultural, legal, political, historic, competitors, consumers etc. as a whole also affects the personnel system. The resource system receives inputs from the organization in the form of objectives and it results in 3
individual and organizational performance that may be viewed as individual and organizational output. Both the personnel system and the entire organizations operate under the same cultural, economic, social, legal, political and other constraints. Hence, greater the effectiveness and productivity of personnel, the more will be the effective functioning of an organization. Peter F. Drucker has rightly observed the significance of personnel as, managers are fond of repeating the truism that the only real difference between one organization and the other is the performance of the people”. In essence
the
survival,
development
and
performance
of
an
organization although not solely but heavily _ depends on the equality of personnel. Environmental Influence The external environment is comprised of those factors, which affect
an
organization’s
human
resources
from
outside
the
organization. Important among them are, economic, social, political, Governmental and legal, technological, manpower, in the country, tradition and culture, customers, other organizations and trade unions in other organizations. Each of these external factors separately or in combination can influence the HRM function of any organization. Further, changes in these factors make the personnel manager’s job a challenging one.
4
Environmental Scanning of HRM External Technological Internal Governmental Legal
Marketing
Organizational Objectives
Customers
Political HRM Organizational Politics
Production
Finance
Economic
Organizational Structure Environment
Trade Unions in other Organizations
Human Resources in Country
Social Including Religious
The internal environment also affects the job of a personnel manager. The internal environmental factors include organization objectives, policies, organizational structure, the functional areas of the organization with which the personnel managers works continuously like
finance,
marketing
and
production.
Impact
of
internal
environmental factors is profound as they frequently and closely 5
interact with HRM function in an organization. For instance, the objectives of HRM are formulated based on the organizational objectives.
Jobs
are
designed
and
analyzed
based
on
the
organizational structure. The personnel manager works closely with other functional (line) managers in solving their personnel problems through counseling, advising, providing information etc. The levels of wage salary, various allowances – incentive compensation etc., are highly influenced by the level of finance and success of marketing functions. Most of the personnel problems are linked with the production function of an organization. Thus the internal environment of an organization influences heavily the HRM. Technological Factors: Just as necessity is mother invention, competition and a host of other reasons are responsible for the rapid technological changes and innovations. In consequence of these changes, technical personnel, skilled workers and machine operators are increasingly required while the demand of the other categories of employees has declined. But it is found that the supply of former category of employees has dwindled in relation to the demand for the same. Hence procurement of skilled employees and their increase in numbers to match the changing job requirements has become a complicated task. In addition, not only new organizational relationships and different motivational techniques to satisfy the changed relationships but also to retain technically skilled and efficient personnel will be required. Changes in the Structure of Employment There has been a significant change in the structure of employment with the entry of a) Candidates belonging to the scheduled cast, scheduled tribe and
backward
communities,
reservation policy and with
6
thanks
to
government’s
b) More female employees, due to increase carrier orientation among women to the suitability of women for certain jobs and to women becoming more acclimatized to the working climate and higher level commitment. These changes in workforce have naturally complicated the task of HRM as the personnel manager has to deal with the employees with different backgrounds. Changes in Employee Role and their Values It was the opinion of the management that it was the boss and the employees had to follow obediently management’s decision. But gradually this relationship has been replaced by the relationship in which
employees
and
management
are
partners
in
the
organizations. It has become imperative for the management to provide various fringe
benefits
machinery
to
to
improve
reduce
morale,
grievance;
to to
introduce encourage
negotiating employee
participation indecision making and the like to pave the way for industrial democracy to meet the situations of workforce. Further, employees prefer flexible working hours to fixed time schedule. Changing Demands of Employers The
technological
revolution
and
neck
to
neck
marketing
competition of most of the organizations demand that the existing employees adopt to the ever changing work situations and learn new skilled, knowledge etc., to cope up with the new changes.
7
FUNCTIONS OF HRM After knowing the meaning and importance of human resource management, how do we define the function of HRM in Mystic Monk Designs Pvt. Ltd.? Managerial Functions Planning: It is a pre-determined course of action. Planning is determination of personnel programmes and changes in advance that will contribute to the organizational goals. In other words it involves planning of human resources, requirements, recruitment, selection, training etc. It also involves forecasting of personnel needs, changing, changing values, attitudes and behavior or employees and their impact on organization. Organizing: An organization is a means to an end. It is essential to carry out the determined course of action. In the words of J.C.Massie, an organization is a “structure and a process by which co-operatives groups of human beings allocated its task among its members, identifies relationships and integrates its activities towards common objective”. Directing: The next logical function after completing planning and organizing is the execution of the plan. The basic function of personnel management at any level is motivating, commanding, leading and activating people. The willing and effective co-operation of employees for the attainment of organizational goals, is possible through proper direction. Controlling: After planning, organizing, directing the various activities
of
the
personnel
management.
At
this
point
the
performance is to be verified in order to know that the personnel functions are performed in conformity with the plans and directions. Controlling also involves checking, verifying and comparing of the 8
actual with the plans, identification of deviations if any and correcting of identified deviations. Operative Functions Employment:
Employment
is
connected
with
securing
and
employing the people possessing required kind and level of human resources necessary to achieve the organizational objectives. Job analysis a) Collection of data, information, facts and ideas relating to various
aspects
of
jobs
including
men,
machines
and
specification,
job
materials. b) Preparation
of
job-description,
job
requirements and employee specification, which will help identifying the nature , levels and quantum of human resources. c) Providing the guides, plan and basis for job design and for all operative functions of HRM. Human Resource Planning:
It is process of determination and
assuring that the organization will have an adequate number of qualifies persons, available to proper times, performing jobs which would meet the needs of the organization and which would provide satisfaction for the individuals involved. Recruitment: It is the process of searching for prospective employees
and
stimulating
them
to
apply
for
jobs
in
an
organization. Selection: It is the process of ascertaining the qualifications, experience, skill, knowledge etc., of an applicant with a view to appraising his/her suitability to a job appraising.
9
Placement: It is the process of assigning the selected candidate with the most suitable job in term of job requirements. It is matching of employee specifications with job requirements. Induction and Orientation:
Induction and orientation are the
techniques by which a new employee is rehabilitated in the changed surrounding and introduced to the practices, policies, purposes and people etc., of the organization. Human Resource development It is the process of improving molding and changing the skills, knowledge, creative ability, aptitude, attitude, values, commitment etc.,
based
on
present
and
future
job
and
organizational
requirements. This function includes: Performance
Appraisal :It is the systematic evaluation of
individuals with respect to their performance on the job and their potential for development. Training; It is the process of imparting the employees the technical and operating skills and knowledge. Management Development: It is the process of designing and conducting suitable executive development programmes as to develop the managerial and human relations skill of employees. Career Planning and Development; It is the planning of one’s career and implementation of career plans by means of education, training, job search and acquisition of work experiences. It includes internal and external mobility. It takes care of transfer, promotion, demotion etc. Compensation: It is the process of providing adequate, equitable and fair remuneration to the employees. It includes job evaluation,
10
wage and salary administration, incentives, bonus, fringe benefits, social security measures etc. Effectiveness of Human Resources Management Effectiveness of various personnel programmes and practices can be measured or evaluated by means of organizational health and human resources accounting etc. Organizational Health: The result of the employee satisfaction can be understood by labor turnover, absenteeism, commitment and the like. Low rate of absenteeism and specific and high rate of employee
commitment
most
probably
indicate
employee
–
satisfaction about the job and the organization. Human
Resource
Accounting,
Audit
and
Research:
Effectiveness of human resources management can also be found out through human resource accounting, audit and research. Human Resource Research: It is the process of evaluating the effectiveness of human resources policies and practices and developing more appropriate ones. It includes; a) Conducting morale, attitude, job satisfaction and behavior surveys. b) Collecting data and information regarding wages, cost-benefit analysis
of training,
benefits, productivity,
absenteeism,
employee turnover, strikes, accidents, operations, working hours, shifts etc. c) Tabulating,
computing
and
analyzing
of
the
information d) Report writing and submission to the line managers
11
data
and
e) Finding pout defects and shortcomings in the existing policies, practices etc. f) Developing
of
more
appropriate
policies,
procedures,
programmes of personnel. Objectives of Human Resource Management The objectives of HRM may be as follows: a) To create and utilize an able and motivated workforce, to accomplish the basic organizational goals. b) To establish and maintain sound organizational structure and desirable working relationships among all the members of the organization. c) To secure the integration of individual and groups goals with those of the organization. d) To create facilities and opportunities for individual or group development so as to match it wit the growth of the organization. e) To attain an effective utilization of human resources in the achievement of organizational goals. f) To identify and satisfy individual and group needs by providing
adequate
and
equitable
wages,
incentives,
employee benefits and social security and measures for challenging work, prestige, recognition, security status etc. g) To maintain high employee morale and sound human relations by sustaining and improving the various conditions and facilities. h) To strengthen and appreciate human assets continuously by providing training and developmental programmes. 12
i) To consider and contribute to the minimization of socioeconomic evils such as un-employment, under-employment, inequalities in the distribution of income and wealth and to improve the welfare of the society by providing employment opportunities to women and disadvantaged section of the society etc. j) To provide an opportunity for expression and voice in management k) To provide fair, acceptable and efficient leadership. l) To provide facilities and conditions of work and creation of favourable
atmosphere
for
employment.
13
maintaining
stability
of
JOB DESIGN Job design process has to start from what activity needs to be in order to achieve organizational goals. It requires the use of techniques
like
work-study,
process
planning,
organizational
methods and organizational analysis. Job Design Options: Personnel departments use a variety of methods to improve jobs such as job rotation, job enlargement and job enrichment. Job Rotation: Job rotation refers to the movement of an employee from one job to another. Job themselves are not actually changed; only the employees are rotated among various jobs. An employee who works on a routine/respective job moves to and works on another job for some hours/day/months and backs up to the first job. This measure relieves the employee from boredom and monotony, improves employee’s skill regarding various jobs and prepares the competent employees to meet the contingencies. This measure also improves worker’s self-image and provides personnel growth. Job Enlargement: Job enlargement means adding more and different tasks to a specialized job to provide greater variety. Job Enrichment: Job enrichment loads the job vertically. Job enrichment means adding duties and responsibilities that will provide for skill variety, task identity, task significance, autonomy and feedback on job performance. It tries to deal with dissatisfaction by increasing job depth as work activities from a vertical slice of the organization unit are combined in one job.
14
Job Analysis Need of Job Analysis Procurement
is
the
first
operative
function
of
personnel
management, which can be sub-divided into various sub-functions like
human
resource
planning,
recruitment
and
selection.
Management should determine the kind of personnel required for a job in right time. Thorough knowledge of the job is essential to perform these functions. Job Terminology Description of technical terminology is highly essential in order to facilitate the study of a job analysis. Task: A task is an action or related group of action designed to produce a definite outcome or result. Position: A position is a group of similar tasks and responsibilities assigned to one individual. Job: A job is “a group of positions that are similar as to kind and level of work”. Occupation: An occupation “is a group of job that are similar as to kind to work and are found throughout an industry or the entire country”. Job Analysis: The U.S. Department of Labor defined job analysis as “the process of determining, by observation and study, and reporting pertinent information relating to the nature of a specific job. Job Description: A job description is “ an organized, factual statement of the duties and responsibilities of a specific job”.
15
Job Specification: A job specification is “a statement of the minimum acceptable human qualities necessary to perform a job properly”. Job Specification: Employee specification is a statement of minimum required employee qualifications”. Job Classification: A job classification is “a grouping of jobs on some specified basis such as kind of work or play”. Process of Job Analysis Jobs can be analyzed through a process, which consist of six basic steps; i.
Collection of Background Information
ii.
Selection of Representative Position to be analyzed
iii.
Collection of Job Analysis of Data
iv.
Developing a Job Description
v.
Developing a Job Specification
vi.
Developing Employee Specification
Job Analysis Information: This analysis provides the following information; 1. Job Identification 2. Significant Characteristics of a Job 3. What the Typical Worker Does? 4. Job Duties 5. What Materials and Equipment the Worker Uses?
16
6. How a Job is performed? 7. Required Personal Attributes Job Relationship: This
includes
opportunities
for
advancement,
patterns
of
promotions, essential cooperation etc.: Sources of Job Analysis Information: a. From the employee who actually perform a job. b. From other employees such as supervisors and foremen who watch the workers while doing a job and thereby acquire knowledge about it; and c. From
outside
observers
specially
appointed
to
watch
employees performing a job. Such outside persons are called the trade job analysis. Sometimes, special job reviewing committees are also established. Job Description Characteristics of Good Job Description: It should indicate the scope and nature of the work including all-important relationships. The job description should be clear regarding the work of the position, duties etc. More specific words should be selected to show a. The kind of work b. The degree of complexity c. The degree of skill required d. The extent to which problems are standardized
17
e. The extent of worker’s responsibility for each phase of the work and f. The degree and type of accountability. The Content of Job Description: The job description normally contains the information on the following line Job title Organizational location of the job Supervision given and received Materials, tools, machinery and equipment worked with Designation of the immediate superiors and subordinates Salary levels: Pay, D.A., other allowances, bonus, incentive wages, method of payment, hours of work, shift, and break. Complete list of duties to be performed separated accordingly to daily, weekly, monthly and casual, estimates times to be spent on each duty. Definition of unusual terms Conditions of work: Location, time, speed of work, accuracy, health hazards, accident hazards Training and development facilities Promotional chances and channels The content of job description are defined in Mystic Monk Designs Pvt. Ltd.but they are done only for the top level or middle level jobs. Our recommendation is that job should clearly defined for all the workers in the organization. It helps in clearly defining the authority responsibility relationship of superior and subordinate. It also helps in job evaluation and giving the right feedback to the worker. Major Steps of Job Description: Job analyst has to write the job description after consulting the worker and the supervisor. After writing the preliminary draft, the job analyst has to get further 18
comments and criticism from the worker and supervisor before preparing the final draft. The following modes may be used in writing job description: i.
Get the questionnaire filled in by immediate supervisor of the employee.
ii.
Job analyst has to complete the job description form by observing the actual work being done by the employee.
iii.
All the information pertaining to the job should be secured from the worker.
The job analyst has to finalize the job description and write the final draft by using any one or a combination of two or more of the above methods. The job description should be reviewed and updated after the final draft is prepared. Keeping the Job Description Up-to-date: Job requirements have been undergoing continuous change. The job analyst has to secure the information about the changes as and when it is reported or when a grievance is ventilated claiming that a given job should be reclassified into a higher group or class carrying the higher rate of pay. The job analyst has to check the information that is received and he has to change the job description accordingly. Job Specification It is a written statement of qualifications, traits, physical and mental characteristics that an individual must possess to perform the job duties and discharge responsibilities effectively. Job Specification Information: This includes: i.
Physical specifications
ii.
Mental specifications 19
iii.
Emotional and social specifications and
iv.
Behavioral specifications
Job Specification Form (this should be maintained for all the job positions in Mystic Monk Designs Pvt. Ltd.) Age Sex Educational Qualifications Experience Physical Specification: Height, weight etc. Social Back ground Family Back ground Extra-curricular activities Hobbies
Employee Specifications: Job specification information must be converted into employee specification information in order to know what kind of person is needed to fill a job. Employee specification is useful to find out the suitability of particular class of candidates to a particular job. Recommended model of employee specification form to be maintained in Mystic Monk Designs Pvt. Ltd.
Job Grade Job Title Age Sex 20
Educational Qualifications Training received Experience Physical specification Social specification Uses of Job Analysis Employment: Job analysis is useful as a guide in every phase of employment process like manpower planning, recruitment selection, placement, orientation induction, and in performance appraisal as it gives the information about duties, tasks and responsibilities etc. Organization Audit: Job information obtained by job analysis often reveals instances of poor organization in terms of the factors affecting job design. Training and development Programs: Description of duties and equipment used is of great help in developing the content of training and development programs. Performance Appraisal: Instead of rating an employee on characteristics such as dependability there is now a tendency toward establishing job goals and appraising the work done toward those goals. Promotion and Transfer; Job description helps I charting the channel of promotion and in showing lateral lines of transfer. Preventing
Dissatisfaction
and
Settling
Complaints:
Job
information can be used as a standard in preventing and settling complaints related to work load nature of work, work procedures etc. alteration or revisions of job description etc.
21
Disciple; Job information can be used as a standard when discipline is being considered for standard performance. Restriction of Employment Activity for Health Reasons and Early Retirement When
employees
are
unable
to
maintain
the
standard
job
performance due to old age or health hazard they may opt for early retirement for the organization may retrench their services. Wage and Salary Administration Job analysis is the basis for job evaluation. Basically wage and salary levels are fixed on the basis of job evaluation, which takes into consideration the content of the job in terms of tasks, duties, responsibilities, risks, hazards, etc. Health and Safety Job description provides the information about hazardous and unhealthy conditions, accident-prone areas etc.
22
HUMAN RESOURCE PLANNING Objective: The important objectives of manpower planning in an organization are: i.
To recruit and retain human resources of required quality, quantity and foresee the employee turnover and make the arrangement for minimizing turnover and filling up of consequent vacancies
ii.
To meet the needs of the programme of expansion, diversification etc.
iii.
To foresee the impact of technology on work, existing employees and future human resource requirements
iv.
To improve the standard, skill, knowledge, ability discipline etc.
v.
To asses the surplus or shortage of human resources and take measure accordingly
vi.
To
maintain
congenial
industrial
relations
by
maintaining optimum level and structure of human resources vii.
To minimize imbalances caused due to non-availability of human resources of right kind, right number in right time and right place
viii. ix.
To make the best use of its human resources and To estimate the cost of human resources.
23
What is Human Resource Planning? E.W/ Vetter viewed human resource planning as “ a process by which as organizations should move from its current manpower to its desired manpower position. According to Leon C. Megginson human resource planning is “ an integrated approach to performing the planning aspects of the personnel function in order to have a sufficient supply of adequately developed and motivated people to perform the duties and task required to meet organizational objectives and satisfy the individual needs and goals of organizational members”. Need of Human Resource Planning Every organization has to plan for human resource due to: i.
The shortage of certain categories of employees and/or variety of skills despite the problem of unemployment.
ii.
The rapid changes in technology, marketing, management etc. and the consequent need for new skills and new categories of employees.
iii.
The changes in organization design and structure affecting manpower demand.
iv.
The demographic changes like the changing profile of the workforce in terms of age, sex, education etc.
v.
The government polices in respect to reservation, child labor, working conditions etc.
vi.
The labor law affecting the demand for the supply of labor.
vii.
Pressure from trade unions, politicians, robots etc.
viii.
Introduction of computers, robots etc. 24
ix.
The involvement of lead-time in maintaining the job with most suitable candidate.
Benefits of Human Source Planning i.
It checks the corporate plan of the organization.
ii.
It offsets uncertainty and change. But the HRP offsets uncertainties and changes to the maximum extent possible and enables the organization to have right men at right time and the right place.
iii.
It provides scope for advancement and development of employees through training, development etc.
iv.
It help to anticipate the cost of salary enhancement, better benefits etc.
v.
It helps to anticipate the cost of salary, benefits and all the cost of human resources facilitating the formulation of budgets in an organization.
vi.
To foresee the need of redundancy and plan to check it or to provide alternatives employment consultation with trade unions,
other
organizations
and
government
through
remodeling organizational, industrial and economic plans. vii.
To foresee the changes values, aptitude and attitude of human
resources
and
to
change
the
techniques
of
interpersonal, management etc. viii.
To plan for physical facilities, working conditions and the volume of fringe benefits like canteen, schools, hospitals, conveyance, child care centers quarters, company stores etc.
ix.
To give an idea of type of tests to be used and interview techniques
in
selection
based 25
on
the
level
of
skills,
qualifications, intelligence, values etc., of future human resource. x.
It causes the development of various sources contributions in the form of increased productivity, sales, turnover etc.
xi.
It facilitates the control of all the functions, operations, contribution and most of human resources.
PROCESS OF HUMAN RESOURCE PLANNING Analyzing the Organization Plans The process of human resource planning should start with analyzing the organizational plan into production plan, technological plan, plan for expansion, diversification etc., marketing plan, sale plan, financial plan,. Each plan can be further analyzed into Sub-units. Detailed programmes should be formulated on the basis of unit-wise plans. Practicability of each programme should be ensured. Analysis of organizational plan and programmes helps in forecasting the demand for human resources as it provides the quantum of future work activity. Forecasting the Overall Human Resource Requirements The existing job design and analysis may thoroughly be reviewed keeping in view the future capabilities, knowledge and skills of present employees. Job analysis and forecasting about the future components of human resource s facilitates demand forecasting. One of the important aspects of demand forecasting is the forecasting of the quality of human resources (skill, knowledge values, capabilities etc.) in addition to the quantity of human resources. Important forecasting methods are: i.
Managerial judgment
ii.
Statistical techniques and 26
iii.
Work-study techniques.
Managerial Judgment: How Mystic Monk Designs Pvt. Ltd.forecasts its overall human resource requirement? Mystic Monk Designs Pvt. Ltd. resorts to the management-judgment approach. Under this method the managers or supervisors who are well acquainted with the work load, efficiency and abilities of the employees, think about their future workload, future capabilities of employees and decides on the number and type of human resource to be required. This is done by the supervisors concerned who send the proposals to he top official for approval. Under this bottom-up approach, the management at the top compares the proposals with the
organizational
plan,
makes
necessary
arrangements
and
finalizes the plan. Alternatively this exercise can also be done by the top management which in turn sends the information at the top prepare the organizational plan, departmental plans and human resource plan. Recommendation: In today’s competitive world work-study analysis is must for any export house. Work Study Techniques These techniques are more suitable where the volume of work is easily measurable. Under this method, total production and activities in terms of clear units are estimated in a year. Man-hours required to produce/perform each unit is calculated. Work ability of each employee is estimated in terms of man-hours after giving due weight age to absenteeism, rest etc. Then the required number of employees is calculated.
27
After an order comes from the buyer and before it goes for production, planning control and work-study analysis should be done:
1.
Order
50,000 shirts
2.
Standard man hour needed to
1.2 hr
produce each unit 3.
Plan man hour needed
40,000 hr
4.
If order has to dispatch in 2
416 working hours (i.e. 52
months i.e. (52 working days)
working days x 8 hr shift / day)
Number of men required
96 employees (40,000/416)
5
Work-study analysis enables an export manufacturing to know the exact details of the number of employees required to complete the task. Supply Forecasting Existing Inventory The data relating to present human resources inventory in terms of human
resources
components,
number,
designation-wise
and
department-wise should be obtained. Principal dimensions of human resources inventory are: i.
Head counts regarding total, department-wise, designationwise, skill-wise, pay roll-wise.
ii.
Job family Inventory: It includes number of category of employees of each job family, i.e. all jobs related to same category like merchandising, production quality etc.
iii.
Age Inventory: It includes age-wise number and category of employees. It indicates age-wise imbalances in present 28
inventory which can be correlated in future selections and promotion iv.
Inventory of skill, experience, values, capabilities.
v.
Inventory of qualifications and training including minute qualifications and training.
vi.
Inventory of salary grade-pay-wise, allowances-wise, and total salary-wise.
vii.
Sex-wise inventory.
viii.
Local and non-local-wise inventory.
Potential Losses Potential losses to the organization include voluntary quits, deaths, retirements, dismissals, lay-offs, disablement due to ill health or involvement in accident, loss of values, aptitude etc. due to changes in the attitude of existing employees towards the job, department and organization. Potential losses to a particular department or subunit include factors like promotions out, transfers out and demotions out in addition to the above factors relating to the organization. The reasons for the potential losses can be classified as: i.
Permanent total loss
ii.
Permanent partial loss
iii.
Temporary total loss and
iv.
Temporary partial loss.
(a) Permanent total loss is due to labor turnover. Labor turnover is measured by the following formula: Labor turn over rate = No. of employees left during a specified period 100
29
X
Average No. of employees during the same period
Management has to calculate the rate of labor turnover, conduct exist interviews regarding dismissal etc. This helps to forecast the rate of potential loss, reason for loss, etc. and reduce loss. Management also calculates labor stability index (rate of employees with certain period of experience to total number of employees), survival rate ( the proportion of employees who are engaged within a certain period who remain with the firm after so many months or years of service) which help the management to encourage a stability and minimize undesirable turnover.
(b) Permanent partial loss consists of wages of skills, capabilities etc. (c)
Temporary
total
loss
of
human
resource
is
due
to
absenteeism and deputations out. (d) Temporary partial loss include consultancy, advisory and other services offered by the employees to others. Potential Additions a) Permanent loss b) Permanent partial c) Temporary total and d) Temporary partial. Permanent total additions to the organization consist of new hires. Permanent
total
additions
in
case
of
departments
include
promotions, demotions and transfers within the organization.
30
Permanent partial addition consists of acquisition of new skills, knowledge, values, aptitudes etc. by the existing employees.
The difference between the potential loss and potential additions is to be added or subtracted as the case may be to the present inventory of human resource in order to forecast the supply of manpower. Future supply of the difference between the Human Resources =
Present inventory of human resources ± potential additions and potential loss of human Resources Or
Present inventory of Human Resources
+
Potential additions _
Potential Loss
Estimating the Net Human Resource Requirements Net human resource requirements in terms of number and components are to be determined in relation to the overall human resource requirements (demand forecast) for a future date and supply forecast for that date. Action Plan for Redeployment, redundancy/Retirement If future surplus is estimated, the organization has to plan for redeployment, redundancy etc. If surplus is estimated in some jobs/departments,
employees
can
be
redeployed
in
other
jobs/departments where the deficit of employees is estimated. Organization should also plan for training or reorientation before redeployment of employees. Redeployment takes place in the form of transfers. If the deficit is not estimated in any job/department and surplus is estimated for the entire organization, the organization, in consultation with the trade unions, has to plan for redundancy or retrenchment. 31
Forecast Future Supply from All the Sources Action Plan for Recruitment, Development etc. The promotion plan includes establishing of the ratio of internal promotion to external recruits, basis for promotion, promotional channel, and reservations in promotions etc. The transfer plan includes channel, company rules regarding organization initiated transfers and employee initiated transfers. The training and development plan covers areas to be developed, training techniques, training programmes, training time, availability of trainer, in plant training or institute training, new courses to be developed or changes made to the existing courses, cost benefit analysis of training, development of the employees and matching of their improved skills with future job requirements etc. The productivity plan includes maximization of productivity or minimization of labor cost per unit of output through technological changes,
improving
/
streamlining
methods,
procedures
and
systems, productivity bargaining, training, financial incentives, developing various schemes, motivation, commitment, organization development participation
programmes, etc.
It
also
job
enrichment/
includes
improving
enlargement, of
productivity
efficiency. Recruitment and selection plans cover the number and types of employment required, when they are required for the job, time necessary for recruitment and selection process, recruitment sources, recruitment techniques to be used, selection procedures to be adopted, selection techniques to be used to select the required candidates. It also covers the time factor for induction, preliminary training and placement.
32
Modify the Organizational Plan Retention Plan Control and Review Mechanism MODEL FOR CALCULATION OF NET HUMAN RESOURCES REQUIRMENT FOR THE NEXT YEAR (this is a recommended model which can be applied in Mystic Monk Designs Pvt. Ltd.) Particular
Skill
Knowle dge
Job: Demand 1.Number required at the beginning of the year 2. Changes during the year 3. Total requirements at the end of the year Supply 4. Present inventory 5. Additions: Permanent total i. New hires ii. Promotions in iii. Transfers in Demotions in Permanent partial Temporary: Deputation in Loss: Permanent total 6.i. Voluntary quits
33
Aptitude
Speciali zation
Age
Number
ii, Deaths iii. Dismissals iv. Retirements v. Promotions out vi. Transfers out vii. Demotions out Permanent partial Temporary: Absenteeism Deputations out 7. Future net supply New Recruitments 8. Deficit/ Needed Additions 9 Surplus/Redeployment 10 Net Additional Human Resources Required
34
RECRUITMENT Definition Recruitment is defined as, “a process to discover the sources of manpower to meet the requirements of the staffing schedule and to employ
effective
measures
for
attracting
that
manpower
in
adequate numbers to facilitate effective selection of an efficient workforce”. Edwin B. Flippo defined recruitment as “ the process of searching for prospective employees and stimulating them to apply for jobs in the organization”. Recruitment Policy Recruitment policy of any organization is derived from the personnel policy of the same organization. In other words the former is the part of the latter. However, recruitment policy by itself should take into consideration the government’s reservation policy, policy regarding sons of soil etc. personnel policies of other organizations regarding merit, internal sources, social responsibility in absorbing minority section, women etc. Recruitment policy should commit itself to the organization’s personnel policy like enriching the organization’s human resources or serving the community by absorbing the weaker sections and disadvantaged people of the society, motivating the employees through internal promotions, improving the employee loyalty to the organization by absorbing the retrenched or laid-off employees or casual/temporary employees or dependents of present/former employees etc. The following factors should be taken into consideration in formulating recruitment policy. They are: a. Government’s policies; 35
b. Personnel policies of other competing organization; c. Organization’s personnel policies; d. Recruitment sources; e. Recruitment needs; f. Recruitment cost; g. Selection criteria and preference etc. Centralized Vs. Decentralized Recruitment Merits of Centralized Recruitment i.
Average cost of recruitment per candidate/unit should be relatively less due to economies of scale.
ii.
It would have more expertise available to it.
iii.
It can ensure broad uniformity among human resources of various units/zones in respect of education, skill, knowledge, talent etc.
iv.
It would generally be above malpractices, abuse of power, favoritism, bias etc.
v.
It would facilitate interchangeability of staff among various units/zones.
vi.
It enables the line managers of various units and zones to concentrate on their operational activities by relieving them from the recruitment functions.
vii.
It enables the organization to have centralized selection procedure, promotional and transfer procedure etc.
36
viii.
It enables the organization to have centralized selection procedure, promotional and transfer procedure etc.
ix.
It enables centralized training programmes, which further brings uniformity and minimizes average cost of staff.
Merits of decentralized Recruitment i.
The unit concerned concentrates only on those sources/places where it normally gets the suitable candidates. As such the cost of recruitment would be relatively less.
ii.
The unit gets most suitable candidates as it is well aware of the requirements of the jobs regarding cultural, traditional, family background aspects, local factors, social factors etc.
iii.
Units can recruit candidates as and when they are required without any delay.
iv.
The units would enjoy freedom in finding out, developing the sources, in selecting and employing the techniques to stimulate the candidate.
v.
The
unit
would
relatively
enjoy
advantage
about
the
availability of information, control and feedback and various functions/processes of recruitment. vi.
The unit would enjoy better familiarity and control over the employees it recruits rather than on employees selected by the central recruitment agency.
Both the system of recruitment would suffer from their own demerits. Hence, the management has to weigh both the merits and demerits of each system before making a final decision about centralizing or decentralizing the recruitment. Alternatively the management
may
decentralized
the
recruitment
of
certain
categories of employees preferably middle and top level managerial 37
personnel and centralize the recruitment of the other categories of the employees preferably lower level positions in view and the nature of the jobs and suitability of those systems for those categories of positions. The management has to find out and develop the sources of recruitment after deciding upon centralizing or decentralizing the recruitment function. In Mystic Monk Designs Pvt. Ltd.recruitments for higher-level jobs are decentralized whereas recruitments for lower level jobs such as operators, pattern masters, assistants to merchants, fabric chasers are all done centrally through employment agencies. SOURCES OF RECRUITMENT The sources of recruitment are broadly divided into internal sources and external sources. Internal sources are the sources within an organizational pursuits. External sources are the sources outside organizational pursuits. Internal Sources Internal sources include: a. Present permanent employees; b. Present temporary/casual employees; c. Retrenched or retired employees; d. Dependents of deceased. Disabled, retired and present employees.
38
In Mystic Monk Designs Pvt. Ltd.lots of operators in the production department are given opportunities to become inline quality checkers. This provides a lot of motivation to the operators to improve their efficiency. Why Do organizations Prefer Internal Sources? Organizations prefer this source to external source to some extent for the following reasons: i.
Internal recruitment can be used as a technique of motivation;
ii.
Morale of the employees can be improved;
iii.
Suitability of the internal candidates can be judged better than the external candidates as “ known devils are better than unknown angles”;
iv.
Loyalty, commitment, a sense of belongingness, and the security of the present employees can be enhanced;
v.
Employees’ psychological needs can be met by providing an opportunity for advancement;
vi.
Employees economic needs for promotion, higher income can be satisfied;
vii.
Cost of selection can be minimized;
viii.
Cost of training, induction, orientation, period of adaptability to the organization can be satisfied;
ix.
Trade unions can be satisfied;
x.
Social responsibility towards employees may be discharged;
xi.
Stability of employment can be ensured.
39
External Sources i.
The suitable candidates with skill, knowledge, talent etc. are generally available;
ii.
Candidates can be selected with out any pre-conceived notion or reservations;
iii.
Cost of employees can be minimized because employees selected from this Latest knowledge, skill, innovative or creative talent can also be flow source are generally placed in minimum pay scale;
iv.
Expertise, excellence and experience in other organizations can be easily brought into the organization;
v.
Human
resources
mix
can
be
balanced
with
different
background, experience, skill etc.; vi.
Latest knowledge, skill, innovative or creative talents can also be flowed into the organization;
vii.
Existing will also broadens their personality;
viii.
Long-run benefit to the organization in the sense that qualitative human resources can be brought.
External Sources include; a. Educational and training Institutes; b. Private employment agencies/consultants; c. Public Employment Exchanges; d. Professional Associations; e. Data banks;
40
f. Casual Applicants; g. Similar Organizations; h. Trade Unions. In Mystic Monk Designs Pvt. Ltd.a lot of middle level and higher-level personnel are recruited from similar organizations or through consultants. Juniors merchants and production in charges may be recruited from education or training institutes. The lower level recruitments are made from employment agencies and also from casual applicants. RECRUITMENT TECHNIQUES Recruitment
techniques
are
the
means
or
media
by which
management contracts prospective employees or provide necessary information or exchanges ideas or stimulate them to apply for jobs. Management uses different types of techniques to stimulate internal and external candidates. Techniques useful to stimulate internal candidates are: a. Promotions; and b. Transfers Techniques useful to stimulate external candidates: a. Present employees; b. Scouting; c. Advertising. (i) Promotions (ii) Transfers
41
(iii) Recommendations of the Present Employees (iv) Scouting (v) Advertising
42
SELECTION The guiding policy in selection is the intention to choose the bestqualified and suitable candidate for each unfilled spot and to avoid commitment to those who will not work well. The selection to procedure is the system of functions and devices adopted in a given company to ascertain whether the candidates’ specifications are matched with the job specifications and requirements or not. The selection procedure cannot be effective until and unless: a. Requirements of the job to be filled have been clearly specified (job analysis etc.) b. Employee specifications (physical, mental, social, behavioral etc.) have been clearly specified; c. Candidates for screening have been attracted. Essentials of Selection Procedure a. Some one should have the authority to select. This authority comes from the employment requisition, as developed by an analysis of the workload and work force. b. There must be some standard of personnel with which a prospective employee may be compared, i.e., there should be available before hand a comprehensive job description and job specification as developed by a job analysis. c. There must be sufficient number of applicants from whom the required number of employees may be selected. Organizational Relationship Before designing a selection procedure, the manner in which task and responsibilities for accepting or rejecting candidates should be shared by line and staff executives. They must be laid down. The 43
personnel department should eliminate all unsuccessful candidates, so that the time of the line executives need not be spent on such people. Secondly, candidates who can meet job requirements should be made available
promptly. Line executive is ultimately
vested with the authority either to accept or to reject a candidate. However, the personnel officer has a duty to see that the right types of personnel are selected and placement done wisely. If he is not satisfied in this regard, he should give his views to the superior and should avoid involving himself in argument with departmental head on methods of selection. Factors Affecting Selection Decisions in Apparel Industry Organizational and Social Environment; Some candidates who are eminently suitable for the job, may fail as successful employees due to
varying
candidates’
organizational specifications
and
social
environment.
must
match
with
not
Hence,
only
job
specifications but also with organizational and social environmental requirements. Selection Procedure (1)Job Analysis: Job analysis is the basis for selecting the right candidate. Every organization should finalize the job analysis, job description, job specification and employee’s specifications before proceeding to the next step of selection. (2)Recruitment: Recruitment refers to the process of searching for prospective employees and stimulating them to apply for jobs in an organization. It is the basis for the remaining techniques of the selection and the latter varies depending upon the former.
44
Application Form
Personnel background Information: Educational Attainments: Work Experience: Salary: Personal Items: References: Options of Interviews Available for Apparel Industry Preliminary Interview The preliminary interview is to solicit necessary information from the prospective applicants and to assess the applicant’s suitability to the job. An assistant in the personnel department may conduct this. The information thus provided by the candidate may be related to
the
job
or
personnel
specifications
regarding
education,
experience, and salary expected, aptitude towards the job, age, physical appearance and other physical requirements etc. If the information
supplied
by
the
candidate
is
below/above
the
availability of number of suitable candidates. Thus, preliminary interview is useful as a process of eliminating the undesirable and unsuitable candidates. If a candidate satisfied the job requirements regarding most of the areas, he mat be selected for further process. The preliminary interviews are short and known as stand-up interviews or sizing-up of the candidates or screening interviews. However, certain required amount of care is to be taken to ensure that the desirable workers are not eliminated. This interview is also useful to provide the basic information about the company to the candidate. 45
Core Interview It is normally the interaction between the candidate and the line executive or experts on various areas of job knowledge, skill, talent, etc. This interview may take place various forms like: (a) Background information interview: This interview is intended to collect the information which is not available in the application blank and to check that information provided in the application blank regarding education, place of domicile, family, health, interest, hobbies, likes, dislikes, extracurricular activities of the applicant. (b) Job and probing interview: This interview aims at testing the candidate’s job knowledge about duties, activities, methods of doing the job, critical/problematic areas, methods of handling those areas etc. (c) Stress interview; This interview aims at testing the candidate’s job behavior and level of withstanding during the period of stress and strain. Interviewer tests the candidate by putting him under stress and strain by interrupting the applicant from answering, criticizing his opinions, asking questions pertaining to unrelated areas, keeping silent for unduly long period after he has finished speaking etc. Stress during the middle portion of the interview gives effective results. Stress interview must be handled with utmost care and skill. This type of interview is often invalid, as the interviewee’s need for a job; his previous experience in such type of interviews may inhibit his actual behavior under such situations.
(d) Panel Interview: Interviewing of candidates by one person may not be effective as he can not judge the 46
candidates in different areas/skills owing to lack of knowledge and competence in multiple disciplines and areas. Hence, most organizations invite a panel of experts, specialized in different areas/fields/disciplines, to interview candidates. A panel of experts interviews each candidate, judges his performance individually and prepares a consolidated judgment based on each expert’s judgment and weight age of each factor. This type of interview is known as panel interview, which is more effective as an expert in relevant areas prepares each candidate. Experts should be cautioned against over accuracy, excessive weight age to a particular factor, domination of other experts etc. At what level of the
What takes place in
organization?
Mystic Monk
Recommendations
Designs Pvt. Ltd.? Top level selection
There are generally
There should be a
two interviews. The
panel interview. The
first interview takes
panels should
place with the
comprise of general
General manager and
manager, department
the second interview
head and the human
takes place with the
resource manager of
department head.
the company. It is important to know the human resource management skills of a top-level employee.
Middle level selection
The selections are
There should be two
generally made on
round of interviews.
the basis of one
The first should be a
interview with the
preliminary interview
47
respective
with the human
department head.
resource manager of that level and the second should be with the respective department head.
Lower level selection
There are generally
A preliminary
no interviews for their
interview may be a
selection; they are
good option to know
selected on the basis
about the basic
of recommendation
qualification, technical
made by the
skills, and attitude. A
employment
list can be maintained
agencies, employees
for the employees
of the export house.
who have future prospects of growth, who are willing to undertake additional responsibilities ,who are very enthusiastic.
Interview Process Interview is not a single step. It is a process consisting of several steps. The major steps are grouped into four categories;
(a) Preparation for the interview
•Appropriate type of interview •The areas to be tested •Type and number of interviews •Review the information
48
(b) Conduct the interview
•Open the interview •Get complete and accurate
information •Record observations and impressions •Guide the interview •Check the success of the interview c) Close the interview (d) Evaluate interview results A panel of interview is preferable to individual interview. The number of interviewers is to be decided on the basis of number and nature of areas to be covered by the interview, number of candidates
to
be
interviewed
and
the
time
available
for
interviewing. Evaluation of Interview Results The
interviewer/the
board
of
interviewers
evaluate
(s)
the
candidates strengthens and weaknesses against the job and organizational requirements. The evaluation is generally based on the observations, impressions and information collected during the course of interview. However, the final decision about the suitability of candidate to the job is made on the basis of the results of all selection techniques. But the interview results influence the selection decision much more than any other technique. The evaluation may be in descriptive form or grading form or rating form. The interviewer has to strike a fine balance between the job requirements and the employee values skills, knowledge etc.
49
Reference Checks After completion of the final interview and medical examination, the personnel
department
will
engage
in
checking
references.
Candidates are required to give the names of reference in their familiar with the candidate’s academic achievement or from the applicant’s previous employer, who is well versed with the applicant’s job performance, and sometimes from co-workers. In case the reference check is from the previous employer, information for the following areas may be obtained. They are: job title, job description, period of employment, pay and allowances, gross emoluments, benefits provided, rate of absence, willingness of the previous employer to employ the candidate again etc. Final Decision by the Line Manager Concerned The Line manager concerned has to make the final decision whether to select or reject a candidate after soliciting the required information through different techniques discussed earlier. The Line manager has to take much care in taking the final decision not only because of economic implications and of the decisions but also because of behavioral and social implications. Employment Thus, after taking the final decision the organization has to intimate this decision to the successful as well as unsuccessful candidates. The organization sends the appointment orders to the successful candidates either immediately or after sometimes depending upon its time schedule.
50
Placement The organization, generally, decides the final placement after the initial training is over on the basis of candidate’s aptitude and performance during the training/probation period. Probation period generally ranges between sic months and two years. If the performance is not satisfactory, the organization may extend the probation or ask the candidate to quit the job. If the employee’s performance during the probation is satisfactory, his services will be regularized and he will be placed permanently on a job. Induction “Induction is the process of receiving and welcoming an employee when he first joins a company and giving him the basic information he needs to settle down quickly and happily and start work”. Lecture, handbook, film, group seminar are used to impart the information to new employees about the environment of the job and the organization in order to make the new employee acquaint himself with the following heads: a. About the company’s history; b. About the department; c. About the superiors, subordinates etc. About the company a) History, growth, organization and management, products, market, customers etc. of the company; b) Basic conditions of employment-hours of work, shift, holidays, retirement benefits; c) Pay, allowances, deductions;
51
d) Sickness rules, information-pay-sick leaves; e) Leaves rule-casual, special, earned-holidays, vacation; f) Work rule, work-load, use of materials, equipment, machine g) Disciplinary rules and procedures; h) Grievance procedure; i) Career path, promotion channel; j) Unions, negotiation channel; k) Education, training and development facilities; l) Health, safety, medical are arrangements; m) Canteen and restaurant facilities; n) Social benefits and welfare measures; o) Telephone calls and correspondence; p) Traveling and subsistence expenses; q) Uniform, clothing; r) Various employees- their designations – position in the organization. About the Department The departmental head concerned introduces the new employee to the
important
employees
and
describes
briefly
about
the
department and the job. Then the supervisor concerned introduced the employee to all the employees in the section/unit, describes in detail the job or work, process of the production, place of the employee’s job and its significance in the process of production, his position
in
the
departmental 52
organization
structure,
work
distribution, assignment, working hours, shift, quality/standard to be maintained, customers/users of the product/services etc. Advantages of Induction a. First impression matters a good deal and results in less turnover; b. Newcomer adjust himself to the work quickly, and it saves the time of the supervisor; c. Reduces employee dissatisfaction and grievances; d. Develops a sense of belongingness and commitment.
53
PERFORMANCE APPRAISAL Performance appraisal is a method of evaluating the behavior of employees in the workspot, normally including both the quantitative and qualitative aspects of job performance. Performance refers to the degree of accomplishment of the tasks that make up an individual’s job. Performance is always measured in terms of results and not efforts. Advantages of Performance Appraisal: In order to find whether The employee is worthy of continued employment or not Whether he should receive a bonus, a pay rise or
promotion, his performance needs to be evaluated from time to time. When properly conducted performance appraisals not only help the employee know how well he is performing but should also influence the employee’s future level of effort, activities, results and task direction. Features of Performance Appraisal: Performance Appraisal is the systematic description of an employee’s job-relevant strengths and weaknesses To find out how well the employee is performing the job and establish a plan of improvement Appraisals are arranged periodically according to a definite plan It is a continuous process in every large scale organization
54
The major difference between Performance Appraisal and Job Evaluation is that the performance appraisal refers to how well an employee is doing the assigned job; and how a job is worth to the organization, and, therefore, what range of pay should be assigned to the job is determined by Job Evaluation. Uses of Performance Appraisals 1. Performance Improvement: Performance feedback allows employee, manager, and personnel specialists to intervene with appropriate actions to improve performance. 2. Compensation Adjustment: Performance evaluations help decision-makers determine who should receive pay raises. Many firms grant part or all of their pay increases and bonuses based upon merit, which is determined mostly through performance appraisals. 3. Placement Decisions: Promotions, transfers, and demotions are usually based on past or anticipated performance. Often promotions are a reward for past performance. 4. Training and Development Needs: Poor performance may indicate the need for retraining. Likewise, good performance may indicate untapped potential that should be developed. 5. Career Planning and Development: Performance feedback guides career decisions about specific career paths one should investigate. 6. Staffing Process Decisions: Good or bad performance implies strengths or weaknesses in the personnel department’s staffing procedures. 7. Job Design Errors: Poor performance may be a symptom of illconceived job designs. Appraisals help diagnose these errors. 8. Information Inaccuracies: Poor performance may indicate errors in job analysis information, human resource plans, or other
parts
of
the
personnel 55
management
information
system. Reliance on inaccurate information may have led to inappropriate hiring, training, or counseling decisions. 9. Feedback
to
Human
Resources:
Good/bad
performance
throughout the organization indicates how well the human resource function is performing. Analysis Performance Appraisal is a continuous process in every large scale organization but unfortunately not so structured in Mystic Monk Designs Pvt. Ltd.. With the company in the expansion mode having two plants and one upcoming there is the need of taking placement decisions like promotions, transfers and good staffing decisions. The
Mystic
Monk
Designs
Pvt.
Ltd.follows
the
Supervisor
Appraisal System. The supervisors include only the superiors of the employee and the top management. The other superiors having knowledge about the work of the employee and other department heads or managers are not included in the Supervisor Appraisal system. General practice is that immediate superiors appraise the performance, which in turn is reviewed by the department head/manager. This is because supervisors are responsible for managing their subordinates and they have opportunity to observe, direct and control the subordinate continuously. Moreover, they are responsible for successful performance of their subordinates. The Human Resource Manager is not even consulted by the top management. Recommendation For Mystic Monk Designs Pvt. Ltd.the Performance Appraisal by Consultants is the best-suited model: The appraiser may be any person who has thorough knowledge about the job content, contents to be appraised, standards of contents, and who observes the employee while performing the job. 56
The appraiser should be capable of determining what is more important and what is relatively less important. He should prepare reports and make judgments without bias. Out of the typical appraisers
as
Supervisors,
themselves, Users consultants
is
Peers,
of service
best
Subordinates,
and Consultants;
suited
for
the
Employees
the
company.
use The
of top
management should focus on strategic planning and somehow minor issues for hiring of labor or line managers should be given to the consultant. However the top management must be well aware and take help of consultants while keeping employees at middle or top management levels. The Consultants are engaged for appraisal when employees or employers do not trust supervisor appraisal and management does not trust the self appraisal or peer appraisal or subordinate appraisal. In this situation, consultants are trained and they observe the employee at work for sufficiently long time for the purpose of appraisal. Performance Appraisal Model for Mystic Monk Designs Pvt. Ltd.- Assessment Centre Model In this approach individuals from various departments are brought together to spend two or three days working on an individual or group assignment similar to ones they would be handling when promoted. Observers rank the performance of each and every participant in order of merit. The assessment centers are basically meant for evaluating the potential of candidates to be considered for promotion, training or development; they offer an excellent means for conducting evaluation processes in an objective way. All assesses get an equal opportunity to show their position talents and capabilities and secure promotion based on merit. Since evaluators know the position requirements intimately and are trained to perform the evaluation process in an objective manner, the 57
performance ratings may find favor with majority of the employees. A considerable amount of research evidence is available to support the contention that people chosen by this method prove better than those chosen by other methods. The centre enables individuals working in low status departments to compete with people from well known departments and enlarge their promotional chances. Such opportunities, when created on a regular basis, will go a long way in improving the morale of promising candidates working in less important positions. This will also help top management to find out the real talents who can be well utilized in the new plant and can be delegated with higher responsibilities.
Obtain Top Manageme nt Commitme
Do Detailed Job Analysis
Define Dimensions to Be Assessed
Design Physical Facilities
Conduct Program
Select Exercises and Participants
Design Assessor Training Program
Provide Feedback
Evaluate Participants and Centre Against Job Success Criteria
58
Train Assesso rs
Key Elements of Performance Appraisal Human Performance
Performance Appraisal
Employee Feedback
Performance Measure
PerformanceRelated Standards
Human Resource Decisions
Employee Records
59
TRAINING Meaning It is the set of activities that provide the opportunity to acquire and improve the job related skills. It is defined as the systematic modification of behavior through learning, which occurs as a result of education, instruction, and development and planned experience. Training is learning processlearning is defined as more or less permanent change in behavior, which occurs as a result of the influence of external, environmental stimuli on the inherent, genetic disposition of the individual. Importance of Training Training is the most important technique of human resource development. Organizational efficiency, productivity, progress and development to a greater extent depend on training. Benefits of Training 1. How training benefits the Organization •
Leads to improved profitability and/or more positive attitudes toward profit orientation
•
Improves the job knowledge and skills at all levels of the organization
•
Improves the morale of the workforce
•
Aids in organizational development
•
Provides information for future needs in all areas of the organization
60
•
Creates
an
appropriate
climate
for
growth,
communication 2. Benefits to the Individual which in Turn Should Benefit The Organization •
Increases job satisfaction and recognition
•
Helps eliminate fear in attempting new tasks
Analysis It is observed that employees are given some sort of On-The-Job Training which can not be called as a proper training method. Mystic Monk Designs Pvt. Ltd.conducts no structured training programs for the employees. The reasons behind it are the following: 1. They find the training programs as wastage of time. 2. The labor is on the contract basis so if they are given any training there is no surety that they will stay forever. 3. There is limited capacity to adjust them in the company. Recommendation The need for training is for every organization big or small, old or newly
established
should
provide
training
to
all
employees
irrespective of their qualification, skill, and suitability for the job etc. Thus, no organization
can choose
whether or not to train
employees. Training is used continuously in every well run establishment. The need for training arises in Mystic Monk Designs Pvt. Ltd.due to the following reasons: 1. Organizational Viability and Transformation Process: In the post quota scenario there is high competition for this export 61
manufacturing of high fashion apparels so if the company does not adapt itself to the changing factors in the environment; it will lose its market share. 3. Technological Advances: Every organization in order to survive and to be effective should adopt the latest technology, i.e., mechanization, computerization and automation. Adoption of latest technological means and methods will not be complete until they are manned by employees possessing skills to operate them. So Mystic Monk Designs Pvt. Ltd.must take advantage of software like ERPS and should train the employees to enrich them in the areas of changing technical skills and knowledge from time to time. 4. Organizational Complexity: With the emergence of increased mechanization and with the extension of operations to various regions of the NCR, and extension in new overseas markets the company must have a structure to train its employees. Training Methods Recommended For Mystic Monk Designs Pvt. Ltd.: 1. Job Rotation: This type of training involves the movement of the trainee from one job to another. The employees in departments like production and quality should be trained about all the processes in the particular departments. 2. Job Instruction: This method is also known as training through step by step. Under this method the trainer explains the trainee the way of doing the jobs, job knowledge and skills and allows him to do the job. The line manager can teach the assembly line operator and similarly the senior merchandiser may direct the assistant merchandiser. 3. Conference or Discussion: It is an Off-the-Job training method to train the professional and supervisory personnel. This method can be beneficial in Mystic Monk Designs Pvt. Ltd.where people can pose ideas to improve quality and 62
productivity. It can be a good platform for both merchandising and production personnel to solve problems existing amongst. 4. Training Aids: Films, slides, Projections, Movies, Stills can be shown to all the employees to improve their personality and working styles.
63
WAGE AND SALARY AND INCENTIVE STRUCTURE OF THE ORGANIZATION The Company Mystic Monk Designs Pvt. Ltd.based in Gurgaon follow the pay structure broadly on the following occupational groupings: •
Managerial and Professional: Top, middle and junior
•
Technical/supervisory
•
Administrative and clerical
•
Manual (workers): Highly skilled, unskilled
By definition the wage means all remuneration (express or implied) capable of being expressed in terms of money including all allowances, prerequisites, concessions and commissions. The wage structure is divided into three components: •
The basic wage
•
The variable dearness allowance
•
he other allowances and incentives
The basic wage of 60%, 25% house rent allowance and 15% of conveyances are provided by the company. The basic wage is fixed as price for labor/services rendered. The following is the set of criteria, which the company follows for basic wage as per the Fair Wages Committee (1948) •
The experience involved
•
The degree of skill
•
The responsibilities undertaken and also
64
•
The salary and incentives provided by the previous company. This last criterion is for recruiting the Senior Merchandisers and Senior Production Managers.
For the Technical and Worker class the technical knowledge is the primary criteria of deciding the payment. The Payment by Results is another system of linking workers' earnings to a measure of performance. The salaries to all the occupational groupings are paid on the monthly basis. The company provides the following allowances: Car, Cellular phone,
Conveyance/Transport,
Medical
allowances,
Overtime,
Provident Fund, ESIS, Family, and Uniform. The ESIS provides benefits to employees in case of sickness, maternity, employment injury
and
related
matters.
These
allowances
have
been
recommended by the Fourth Central Pay Commission (1986) and the High Powered Pay Commission (1988). The Provident Fund is given to people with salary below Rs. 6500 and the ESI given is to those with salary above Rs.7500. Social Security Legislation Abided by the Company and Additional Benefits. Pay and benefit are important elements in Human Resource Management. The policies and programs are affected by the theoretical, public policy, labour market situation, and pressure from unions and strongly by legal framework. The additional benefits or Fringe Benefits are the non-wage benefits offered by the company to its employees. They represent a "substantial cost expense to the employer and a cost saving to the employee".
The
key
consideration
employees. 65
is
to
attract
and
retain
•
Attendance Bonus: to encourage punctuality and reduce absenteeism
•
Concern for Security: As individual has been progressively replacing Joint Family System with the nuclear family so for old age and other emergencies Provident Fund, Gratuity and Pension are provided by the company.
•
Social Security
•
Hazards of Industrial Life: To avoid occupational disease caused by the very fine fibers during cutting of fabric the masks are provided.
•
For minor accidents there is a clinic in the manufacturing unit and for major accidents the workers are taken to nearby hospital and are given compensation for the loss.
•
For Senior Merchandiser and the Sr. Production Manager the company provides car, cellular phone, travel allowance and house rent.
Methods adopted for fixation of salary Various factors affecting wages/salary level 1 Remuneration in comparable industries 2 Firms ability to pay 3 Cost of living 4 Productivity 5 Union pressure and strategies 6 Government legislations
66
Firm’s ability to pay •
Productivity in organization
•
Expenses industry has to bear
•
Certain trend in price of product/services-charged by industry.
•
Total cost of employees (salaries, allowances, cost of fringe benefit).
The strong financial situation is directly related to the higher wages for the employee Cost of living •
Purchasing power maintained at same level. Wages have to be fixed-cost of living
Productivity The major factor for increase in the productivity is increase in the employee’s satisfaction, which brings about an increase in their contribution to organization. Government legislation Minimum Wage Act 1948 provides the following: •
Minimum wages in certain employment
•
Minimum time rate
•
Minimum piece rate
•
Guaranteed time rate
•
Over time rate
67
•
Basic pay and DA (Dearness Allowance)
Method adopted for fixation of Salary 1 Time wages Where basic wage is linked to time for which the worker works, it is called time rate wage. The wage becomes payable the moment the worker puts in work for a given period of time. In the case of operatives, the time generally is a day of eight hrs while for staff it is one month. Observed advantages of using time wage system •
Time wage gives the worker a sense of security
•
Worker can devote themselves to the job with great care and attention.
•
When the workers are paid some fixed time rate, they will try to avoid over speeding and consequent damage to the machinery
•
It is simple to calculate.
•
If the production is standardized the productivity of individual worker can be measured.
When production is not carried on in a large scale and modern techniques of production are not employed time wage system is not suitable. Time wage –generally acceptable to trade unions Disadvantage of time wage system 1 Efficiency and payment are not correlated
68
2 There is no motivation 3 There will be variation the average cost of production which create difficulties in calculating cost of production 4 Job security offered to the employees may lead to lesser production Components of wages 1 Basic wage 2 Dearness allowance 3 Incentive wages 4 Other allowances Basic wage is dependent on the nature of one’s work if that determine wage fixation: 1 Education 2 Skill 3 Experience 4 Stress strain 5 Hazard The amount of wages has a direct relationship with the stress and strain involved in a job. In some cases, basic wages are fixed for every job, while in others these are fixed for groups like unskilled, semiskilled, skilled etc. In all cases generally a minimum wage is fixed for the lowest category of unskilled work and others are fixed correlating it. Minimum wages are also fixed on bases of minimum requirement of family.
69
ANALYSIS OF THE FLAWS IN THE WAGE AND SALARY STRUCTURE OF MYSTIC MONK DESIGNS PVT. LTD. •
Employee pay and benefits make up a considerable proportion
of most organizations' total costs, and is one of the main attractions for job seekers. It can also be a main motivating or de-motivating factor for current employees. As such, devising and running a reward strategy to attract and retain the right caliber of employees should be one of the most important roles for the HR department. One of the components of pay is incentives and benefits. Incentives play an important role for motivating an individual to perform his job. The basis upon which incentives are determined and the way in which they are administered can have a significant impact upon employee morale and productivity and thus the achievement of the organizational goal. Incentives attempt to relate rewards directly to performance. Rewarding for merit not only improves the morale and productivity of the employees but it also helps to retain them in the organization. Monetary as well as non-monetary rewards are useful for motivating the employees. Some people who are money motivated especially lower level employees, monetary incentives can play an important role to increase their efficiency in terms of both quantity and quality. Mystic Monk Designs Pvt. Ltd., however,
does
not
follow
any
incentive
plan
for
its
employees. They just pay bonus to the employees once a year. •
One of the major requirements of all the export houses is to deliver their goods on time. For this they require to produce goods at a faster rate. For that the piece rate system could work well for the export house. However the lower level 70
workers that are tailors are paid on the monthly basis. But if they are paid on the basis of piece rate the output could be increased.
Suggestive Improvements •
Comparing pay to the labor market. Salaries are also decided according to the demand and supply of the labour in the market. Before fixing the pay rolls it would prove to be beneficial for the company to take these factors into considerations and also compare their salary structure with the other similar organizations. They will usually be happy to tell you because they want to have the benefit of your data just as much as you would like theirs.
•
Manage internal equity. Managing internal equity is more important than external equity. An employee is much more likely to know the salary of the person in the office next to him or her, than the salary of a person at another company. Also, the employee will have a better basis for salary comparison because he or she has a better idea of what that employee's job and job performance is. All this creates a much higher potential for morale problems and turnover. You manage internal equity by paying people within a salary range, and by paying for performance. Sometimes internal equity will tell you not to provide an employee with a salary increase, but business necessity (the employee is leading a key project and is threatening to leave) may lead you to decide to provide the salary increase. In the short run this may be the right answer, but in the long run it can be costly.
•
Link pay with job performance. Those employees who perform
their
jobs
better 71
should
receive
larger
salary
increases than those who do not. The organization needs to do is establish an adequate performance appraisal system and establish a merit pay system. There are many good examples of merit pay systems in the marketplace ranging from structured to informal. Variable pay systems are growing in popularity and can provide an excellent link between pay and job performance. •
Giving incentives to improve quality. Mystic Monk Designs Pvt. Ltd.doesn’t provide for any incentives. However the company can put an incentive program like paying more to the workers who produce less defected garments. Also the upper level employees can be given incentive for proper and timely execution of each order.
•
Gain sharing. The company can put such plan to improve productivity and efficiency. Gain sharing plans will allow employees to share in productivity gains in accordance with a pre-determined target. Typically the plans can be established with participant involvement and are can be designed for specific
work
groups
(production
department
or
merchandising department), but company-wide programs can also exist.
72
HUMAN RELATIONS Importance of Understanding Human Relations Every employee is different from other so a manager must understand what causes this difference and how to cope with certain problems created because of the association of all these different individuals. Human Relations has been rightly defined in the words of Lee, “human relations are the medium through which both employees and the company mutually cooperate for the maximum satisfaction of the economic, social, psychological wants of the people having relation with an organization which has the objective of increasing productivity”. Measures to Maintain Sound Human Relations •
Frankness clears the misunderstanding and restores the good relation.
•
Effective
communication
improves
the
relations
among
people. Disputes can be effectively handled only when manager is effective in communication. •
By developing sensitivity to others’ feelings and an ability to appreciate others’ ideas.
•
By becoming a good leader the manager can bring cohesion in the
group
he
leads
and
thus
can
contribute
to
the
improvement of human relations. •
By praising the subordinates publicly even for the slight improvement. But do not do this with over ambition.
•
By helping the people perform their duties. 73
Understanding People: In order to understand people one must know the fundamentals of human behavior. This knowledge helps the manager to understand that why people react in a certain way, their wants and drives. Concept of Personality The behavior of any person partly depends on what he feels and thinks about him and partly on how he views the world and others. Thus Personality is sum total of all the physical, mental, emotional and social characteristics of a person. Human Behavior Is Caused Every human action has a cause. The cause of a person’s action is the result of an interaction between a stimulus and the person’s perception of that stimulus. This perception is determined by his background, personality, circumstances that he is in and his earlier experience in life. If the manager understands all these factors, he can be rational in his behavior instead of being emotional. Motivation Meaning Motivation is derived from the word motive. A motive is an inner state that energizes, activates or moves and directs or channels behavior towards goals. It is defined as the degree of readiness of an organization to pursue some designated goal and implies the determination of the nature and locus of the forces, including the degree of readiness. Needs
Drives
Goals/Incentives
74
(Deficiency)
(Deficiency with Direction)
(Reduction of
drives) The Basic Motivation Process Types of Motives Primary Motives: These motives are unlearned and physiologically based. They include hunger, sleep, and avoidance of pain, sex, and maternal concern. General
Motives:
These
motives
are
unlearned
but
not
physiologically based. They include curiosity, manipulation and activity motives and the affection motive. Secondary Motives: These are closely tied to the learning concept. A motive must be learned in order to be included in the secondary classification. Important among them are: achievement, affiliation, power, security, status and immediate feedback. Analysis In today’s fast paced and cut throat competition world every person is bothered with some kind of depression and frustration. The work culture in Mystic Monk Designs Pvt. Ltd.is not deprived of it too. Being the suppliers of High fashion garments the employees are under constant pressure of meeting the deadlines of shipment. Though the company pays well to all its employees meeting their Physiological and Security needs but it need to provide all its employees Acceptance or Affiliation and Esteem Needs (Maslow’s Theory of Hierarchy of Needs). Recommendation In order to motivate people positively the employees at all the levels of management can be rewarded financially. Monetary motivation
75
may include different incentives, wage plans, productive bonus schemes etc. Non monetary motivation may include praise of work, participation in management and social recognition in form of annual family gatherings in the company. Organizational Communication Raymond V. Leisker has described four factors that influence the effectiveness of communication. 1. The formal channels of communication 2. The organizations’ authority structure 3. Job specifications, and 4. Information Ownership The organizational communication can be formal or informal. Formal communication is an official communication having official support and sanction. Formal communication flows through
the
authority
and
responsibility
channels
of
an
organization which exists in order to: •
Measure and control outputs
•
To coordinate complex activities in the system and relate the sub system to the total systems
•
To regulate response to external environment
•
Coordinate resource allocations
•
Create a climate within which the organization can adjust its output as it receives; and process feedback
The advantages of formal communication include: 76
•
Providing correct information
•
Having official support with authority
•
Handling of message efficiently
The drawbacks include: •
Delay in sending immediate information to official channels
•
Absence of immediate feedback
•
Lack of ability to communicate upward
Similarly Informal Communication suffers from various drawbacks: •
It sometimes spread wrong information and rumours
•
It distorts information
•
It overlooks superiors
Analysis Mystic Monk Designs Pvt. Ltd.lacks proper software to integrate the whole value chain right from shop floor to the cabin of the top management. The intra communication is aided by Local Area Network, e-mail between the merchandising department. Recommendation There is need to have an Enterprise Resource Planning System to know about the profile of every employee of the company right from gateman to top manager. Such a system also helps in knowing the requirement of candidates at any post.
77
FRINGE BENEFITS The term fringe benefits refer to various extra benefits provided to employee, in addition to the compensation paid in the form of wage or salary. Balcher defines these benefits as, “any wage cost not directly
connected
with
the
employees’
productive
effort,
performance, service or sacrifice”. Cockmar, defined fringe benefit as, “ those benefits which are provided by an employer to or for the benefit of an employee and which are not in the form of wages, salaries and time related payment”. Fringe benefits are those monetary and non9monetary benefits given to the employees during and post-employment period, which are connected with employment but not to the employees’ contribution to the organization. List of Fringe Benefits that should be offered by “Mystic Monk Designs Pvt. Ltd.” (Though the company offers most of the fringe benefits the following list contains all the fringe benefits that are supposed to be offered by the company: 1. For Employment Security: Benefits under this head include unemployment
insurance,
technological
adjustment
pay,
leave travel pay, overtime pay, leave for negotiation, leave for maternity, leave for grievances, holiday, cost of living bonus, call
back
pay,
lay-off
pay,
retiring
rooms,
jobs
to
sons/daughter of the employees and the like. 2. For Health Protection: Benefits under this head include accident insurance, disability allowance, health insurance, 78
hospitalization, life insurance, medical care, sick benefits sick leave etc. 3. For Old Age and Retirement: 4. For Personnel Identification, Participation and Stimulation: 5. Payment for Time Not Worked, 6. Extra Pay for Time Worked Payment for Time not Worked: This category includes: a. Hours of work: b. Paid holiday; c. Shift premium; d. Holiday pay; e. Paid vacation. Employees Security: Physical and job security to the employee should be also provided with a view to promoting security to the employee and his family members: a. Retrenchment Compensation: Industrial disputes Act 1947 provides for the payment of compensation in case of lay-off and retirement. b. Lay-off compensation :In case of lat-off, employees are entitled to lay0off compensation at the rate of 50% of the total of the basic wage and dearness allowance for the period of lay-off except weekly holidays.
79
Safety and Health: Employee’s safety and health should be taken care of in order to protect the employee against accidents, unhealthy working conditions and to protect worker’s capacity. Workmen’s Compensation: In addition to safety and health measures, provision for the payment of compensation has also been under Workmen’s Compensation Act, 1923. Health Benefits: Today various medical services like hospital, clinical and dispensary facilities are provided by organization not only to employees but also to their family members. Employees State Insurance Act 1948, deals comprehensively about the health benefits to be provide. These include: i.
Sickness benefit;
ii.
Maternity benefit;
iii.
Disablement benefit;
iv.
Medical benefit.
Voluntary Arrangements: Most of the large organizations provide health services over and above the legal requirement to their employees free of cost by setting up hospitals, clinics, dispensaries and homoeopathic dispensaries. Welfare and Recreational Facilities: These include a. Canteens; b. Consumer societies; c. Credit societies; d. Housing; e. Legal aid;
80
f. Employee counseling; g. Welfare organization; h. Holiday homes; i. Educational facilities; j. Transportation; k. Parties and picnics; and l. Miscellaneous. Old Age Retirement Benefits Industrial life generally breaks family system. The saving capacity of the employee is very low due to lower wages, high living cost and increasing aspirations of the employees and his family members. As such, employer provides some benefits to the employees, after retirement and during old age, with a view to create a feeling of security about old age. These benefits include: a. Provident fund; b. Pension; c. Deposit linked insurance; d. Gratuity and e. Medical benefit.
81
CONCLUSION
We conclude this report by providing our model of organization structure. There will be all together twelve people working in the human resource department. Human resource department is pervasive at all levels of the organization. There will be four junior human resource managers taking care of all the role and responsibilities in relation to lower level job position and the employees. Human Relations has been rightly defined in the words of Lee, “human relations are the medium through which both employees and the company mutually cooperate for the maximum satisfaction of the economic, social, psychological wants of the people having relation with an organization which has the objective of increasing productivity”.
82
Such an organization structure will enable “Mystic Monk Designs Pvt. Ltd.” to grow in a very harmonious way.
BIBLIOGRAPHY
Human Resource
Management
C.B.Gupta Human Resource
Management •
T.N.Chabra Exporting garments from India by Nair,
Pradeep Kaul and Rajesh. •
The Abolition of MFA and its impact by
Martin and Will. •
India’s Garment sector- a policy analysis
by Mishra and Sanjeev.
83
•
Newspapers: Economic Times, Times of
India, Hindustan times, Magazines: •
India Today (May 13, 1995)
•
Export Import Trade Flash (June 1997)
•
Business World.
84
PROJECT REPORT ON HUMAN RESOURCE PLANNING AND ITS RELATION TO GARMENT MANUFACTURING At
MYSTIC MONK DESIGNS PVT. LTD.
Submitted by:
ADITYA SIKANDER Roll No. K6BBA052
ASIA PACIFIC INSTITUTE OF MANAGEMENT 3 & 4, INSTITUTIONAL AREA, JASOLA VIHAR, NEW DELHI 85
LIST OF TABLES
Sr. no.
Topics
Page No.
1.
Introduction
1
2.
Objectives
2
3.
Scope and Limitations
3
4.
Research Methodology
4
5.
Literature Review
5
6.
Company Profile
6
7.
Problem Definition
7
8.
Introduction to Human Resource Management
8
9.
Functions of HRM
15
10.
Job Design
21
11.
Human Resource planning
30
12.
Recruitment
42
13.
Selection
49
14.
Performance appraisal
60
15.
Training
66
16.
Wages and salary and incentive structure of the organization
70
17.
Human Relations
79
18.
Conclusion
88
19.
Bibliography
89
86
ACKNOWLEDGEMENT
I have had considerable help and support in making this project report a reality. First and foremost a gratitude goes to Mr. Rahul Rajpal (Director), who provided me all the guidance and support in realizing the dissertation. I must thank the employees of the Mystic Monk Designs Pvt. Ltd. I am grateful to all those who obliged me with their support and helped me in converting my collection of data and information into a research study. At the end I would like to thank God who was always there with me & will always be supporting me in our work.
(ADITYA SIKANDER)
87
