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Human Resources Management - An Overview

Development of HRM - An Overview

   Posted On :  30.05.2018 07:55 am

Awareness regarding HRM was felt during the industrial revolution around 1850 in Western Europe and U.S.A.

Development of HRM

Awareness regarding HRM was felt during the industrial revolution around 1850 in Western Europe and U.S.A. Only during the beginning of 20th century, it was felt in India. Since then to the present era, the development of HRM may be classified as follows:

Trade Union Movement Era

The conditions of workers in the aftermath of factory system as an outcome of industrial revolution, were very pathetic. The first world war worsened the situation. The Royal Commission of Labour in India in 1911, under the chairmanship of J.H. Whitely, recommended the abolition of the ‘Jobber’ system and the appointment of labour officers in industrial enterprise to perform the recruitment function as well as to settle workers’ grievance. Workers also started forming ‘trade unions’. The Trade Union Act, 1926 was passed in India. The basic object underlying trade union was to safeguard the worker’s interest and to sort out their problems such as use of child labour, long hours of work and poor working conditions. These unions used strikes, slowdowns, walkouts, picketing, as weapons for the acceptance of their problems. These activities of trade unions gave rise to personnel practices such as collective bargaining, grievance handling system, arbitration, disciplinary practices, employee benefit programmes and sound wage structure.

Social Responsibility Era

In the beginning of 20th century, some factory owners, employers started showing humanistic approach towards the workers. Robert Owen, a British industrialist, reformer and humanitarian is considered to be the first to adopt humanistic approach towards workers. He viewed that the principal social and economic environments influence the physical, mental and psychological development of workers. Hence he felt that to improve the productivity, it is necessary to improve conditions of employees by removing them from the adverse environment to a congenial atmosphere with the availability of satisfactory living and working conditions.

The philosophy in Owen’s patriatic approach was that workers are just like children and the owner is just like a father. Therefore the owner should take care of the workers, just like a father looks after his children. Owen himself implemented this philosophy in his cotton mill in Scotland by introducing facilities such as shower baths, toilets, rest rooms and increased minimum wages and housing scheme.

Scientific Management Era

The concept of scientific management was introduced by F.W.Taylor in the USA in the early part of 20th century as an alternative to the prevailing system of management by initiative and incentive based on his shop floor job experience.

Taylor developed four principles of scientific management

1. Development and use of scientific methods in setting work standards, determining a fair work, and best way of doing work.

2. Scientific selection and placement of workers best suited to perform the various tasks and provision of their training and development for maximum efficiency.

3. Clear cut division of work and responsibility between management and workers.

4. Harmonious relationship and close cooperation with workers to achieve performance of work in accordance with the planned jobs and tasks.

In the scientific theory, Taylor viewed men and workers as one driven by fear of hunger and search for profit. Accordingly, if economic reward is tied up with the efforts put on the job, the worker will respond with his maximum physical capability.
Taylor also developed several techniques to introduce his scientific ideas in management.

They were
1. Time study – to measure the time taken to each job and each operation and to standardize the operations of the job.
2. Motion study – to study body movements in workplace and to reduce wasteful motions.
3. Standardization of tools, equipments, machinery and working condition.
4. Incentives – wage plan with differential piece rate for efficient and inefficient workers.

Human Relations Era
During the years 1925 to 1935, experts expressed their opinions towards the human aspects of organisation activities. Hugo Munsterberg in his book, “Psychology and Industrial Efficiency”, suggested the use of psychology in selection, placement, testing and training of employees in an organisation. Elton Mayo and his associates conducted a series of experiments from 1924 to 1932 of the Hawthorne plant of the Western Electric Company in the USA. The main findings of Hawthorne Experiments were as follows:
1. Physical environments at the work place do not have any material impact on the efficiency of work.
2. Favourable attitudes of workers and psychological needs had a beneficial impact on the morale and efficiency of workman.
3. Fulfillment of the worker’s social and psychological needs had a beneficial impact on the morale and efficiency of workmen.
4. Employee groups based on social interactions and common interests exercised a strong influence on worker’s performance.
5. Workers cannot be motivated solely by economic rewards. More important motivators are job security, recognition, right to express their opinion on matters related to them.
The findings have stated that the relationship between the superiors and subordinates should relate to social and psychological satisfaction of the employees. Employee satisfaction is the best means of making the employee productive.

Behavioural Science Era

Important elements of behavioural approach to HRM is as follows:

1. Individual behaviour is linked with the group behaviour. For example, a person may resist changing his behaviour as an individual. But he or she will readily do so if the group to which he or she belongs, decides to change its behaviour.

2. Informal leadership rather than the formal leadership of manager is more effective in influencing people to achieve standards of performance. According to their view, democratic leadership style of the manager is more acceptable to the subordinates and hence more effective.

3. By nature, people do not dislike work. Most people enjoy work and one is motivated by self control and self development. In fact job itself is a source of motivation and satisfaction to employee.

4. Expanding subordinate influence, self-control and self – direction can improve operating efficiency.

Systems Approach Era

A system may be defined as a set of interdependent parts forming an organized unit or entity. The system is defined as “an organized and complex whole: an assemblage or combination of things or parts forming a complex unitary whole”. The parts, also known as sub-systems, interact with each other and are subject to change. These sub-systems are inter-related and inter dependant. Three broad sub-systems are

i) Technical sub-system - The formal relationships among the members of an organisation

ii) Social sub – system - Social satisfaction to the members through informal group relations.

iii) Power sub – systems  - Exercise of power or influence by individual or group.

The system approach is characterized by the following features:

1. A system is a group of inter – related elements which are separate entities/ units.

2. All the elements are inter– related in an orderly manner.

3. There is the need for proper and timely communication to facilitate interaction between the elements.

4. The interaction between the elements should lead to achieve some common goal.

At the heart of the systems approach is a Management Information System (MIS) and communication network for collection, analysis and flow of information to facilitate the function of planning and control. Modern thinkers consider HRM as a system that integrates activities with an objective to make the best use of resources which are always scarce.

Contingency Approach Era

Contingency refers to the immediate circumstances. Contingency approach believes that there is no one way of managing that works best in all situations. According to this approach, the best way to manage varies with the situation. Hence this approach is called as ‘situational approach’. There may not be one universal way of managing in all situations. A particular approach may yield fruitful results in one situation but may drastically fail in another situation. Therefore managers are to analyse different situations and then use the best approach suitable in that particular situation.

Development of HRM in India


Like U.K and USA, the evolution and development of HRM in India was not voluntary. After second world war difficult conditions erupted in India. Malpractices in the recruitment of workers and payment of wages led to trade union movement. In 1931, on the recommendations of The Royal Commission of Labour, ‘Jobber’ system was abolished.

 After independence, the Factories Act, 1948 laid down provisions for Labour Officers, Labour welfare, safety and regulation of working hours and working conditions.
Two professional bodies emerged. They are ‘The Indian Institute of Personnel Management’ (IIPM), Calcutta, now ‘Kolkata’ and the ‘National Institute of labour Management (NILM), Bombay, now Mumbai. These two institutes are guiding in Human Resource Management and Labour management.
The massive thrust on basic industries in India during the I Five year plan (1956-61), which accelerated public sector undertakings, gave thrust to personnel management and HRD practices. The professionalism in managing organizations became quite discernible by 1970s. There was a clear shift from welfare approach to efficiency approach. The two professional bodies IIPM & NILM merged in 1980 to form National Institute of Personnel Management (NIPM) with Kolkata as headquarters.
Evolving along the years, the approach has shifted to human values and productivity through people. It is against such a shift in managing people in the 1990s, a new approach has emerged as human resources management (HRM). This approach focuses more on development aspects of human resources.
The changing internal environment in organizations calls for better understanding of human resources management. The culture or climate of an organization is made up of traditions, values, habits, ways of organizing, and interpersonal relationships at work. Culture is reflected in organizational structure, strategy, systems, power and reward distribution, conformity, development process, motivational dynamics, organizational clarity, warmth and support received by employees, leadership styles, standard of performance and shared subordinate values. An effective work culture is flexible, integrated, decentralized, performance – oriented, quality conscious, cooperative, collaborative, and supportive. The major elements of HRM strategy and functions can be related to organizational culture. Corporate mission, philosophy and strategic plan give birth to culture in organizations.

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