Posts Tagged ‘practices’

The HR landscape is changing, and best practices need to be adhered to so that the organization can achieve its goals year-after-year. From a safe and happy workplace, to 360-degree performance management systems — what are the key attributes that define HR success?

How Human Resources Practices Can Help To Implement Ethical Behavior

Human resources practices training ensures that team leaders know how to make ethical decisions and establish standards. The first thing a team leader should do is clearly lay out to everyone what the standards of ethical behavior are. Then, it’s important to begin an open discussion with the team members about what exactly it means to say you will work and behave ethically. One expert recommends that while determining what it means to be ethical, you should also use team agreements. These agreements make statements about what members promise they will and will not do in regards to other team members.

Having team members sign these agreements gives team leaders a helpful way to measure and determine if someone seems to be straying from the agreement. HR practices also help team leaders understand that in order to get the best results, they must be a role model of ethical behavior themselves. According to experts it’s most important that the team leader role model ethical behavior in everything that he or she does and cannot allow something to happen within the team structure, or within the business, or within the company, that goes against ethical behavior.

It’s key for leaders to remember that even giving unspoken approval for something is still considered approval. On the same token, if a leader doesn’t prevent or stop something from occurring, they have essentially made the rules established in the agreements useless. It’s not just important to model ethical behavior inside the workplace, it’s also important for team leaders to practice this code of ethics in everyday life because you never know who could be watching.

All business, organizations, and companies can benefit from the standards that human resources practices should help team leaders to enforce. A team leader who really tries to adhere to ethical practices will begin by being open and implementing open and honest communication throughout the company. HR practices advise leaders to discuss issues and concerns with all team members openly so that they feel comfortable if they need to address certain issues as well. Members of the team need to feel that they can come to the leader with any concern and issue and know that the leader will respond in a positive way and resolve the issue. One way to ensure this is by making meetings completely open and welcoming.

Behaving ethically and ensuring that the company runs in this manner as well is not only positive for the leader, but it also helps the company as a whole. For the team to improve, the leader needs to make sure that the standards agreed upon are upheld at all times. If the standards are not upheld, then it is the leader’s responsibility to take care of the issue head on. This shows other members that the rules and standards are important and can’t be ignored. It also gives the leader credibility. Even if groups break into factions, it is the leaders’ job to put forth more effort and make sure to handle situations as an open group, because part of the agreement should be that team members do not discuss group items individually. This should help ensure ethical behavior within the team and throughout the business.

Human Resources Training: How To Implement Ethical Practices

As a leader, HR training can be useful in teaching you how to ensure ethical outcomes in the workplace. This should begin with an agreement between leaders and all team members that pledges to act in an ethical manner at all times. The agreement should also mention the importance of making sure team members always discuss issues as a group, rather than breaking into factions and holding discussions separately. Team members should agree not to discuss group items outside of the group. If a leader does not put this into the agreement, there is a greater chance that the group will disintegrate. In cases where people don’t follow the agreement and will not adjust to more ethical practices, the leader should replace the person and take the person off of the team. This will show the team the importance of the agreement, of ethical behavior, and ensure an ethical workplace environment.

In HR training leaders learn how to set an example for team members by being the role model and displaying ethical behavior at all times. However, in cases where the team leader is not behaving ethically or with integrity, any team members who notice this should speak up. To approach the issue in the best manner possible, the team member should pull the leader aside and explain that they don’t think the leader is operating or acting appropriately. It would be counter-productive to bring it up in a meeting, it’s best to speak privately if you have to approach a leader.

If a team member needs to confront another team member for a similar issue there is a proper way to go about it. As Human Resources Training explains, when a team member feels that another team member is not acting in the most ethical fashion they should speak up. For example, if you believe that someone is not operating in the most ethical fashion, you need to be willing to talk about it in an appropriate manner. If you are upholding your end of the agreement by behaving ethically as a role model at all times, you can change what you think is wrong. When a team member isn’t making the right decisions, isn’t acting favorably, or says or does something you think is unethical, you can make a difference by saying something in the group meeting, respectfully. It’s important to speak up, because by not speaking up about something you think is wrong, for example a racial joke, you are participating in it as well.

Sometimes the most difficult aspect of ethical practices in the workplace is determining whether an action or decision is ethical or not. According to Human Resources Training experts, there are two tests that can help to determine this. First, experts say that if you have to ask yourself whether or not a decision is ethical, there is a high likelihood that it is not ethical. HR professionals believe that most likely if you aren’t sure if something is right, you probably just shouldn’t do it. However, HR training suggests that employees check with the legal department of the company or their attorney first before making the decision because there is a good chance that they may be missing some important information. However, it’s important to remember that even if an action is legal it still may not be ethical or fall within the ethical standards you agreed to in the agreement with your company. Lastly, you need to ask yourself if a decision is preventing you from sleeping at night. If it is, it does not pass the ethics test and you need to change it.

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Human Resources Practices and the Law

Human resources practices vary globally because each country has its own unique employment laws. When comparing the United States to other countries, which of course have different rules and regulations, it is interesting to see how management styles vary as well. When choosing to obtain an HR certification, you must be aware of the employment laws for the country in which you plan to work in because they will ultimately become the of rulebook for your entire career.

Laws are present in every country—in the United States, there are several levels: federal, state, and local employment laws. Most laws are supervised by government agencies that carry two main responsibilities. First, they must make sure that the laws are deemed suitable and recognized by all so that they are obeyed. Second, the agencies work to make sure that the laws are obeyed by instituting official parameters or procedures. Keep in mind that the laws are put into place to protect employees against unfair treatment. For instance, there are laws that are put in place to prohibit discrimination. Race, sex, and national origin are examples of “protected classes” which, by law, are groupings that cannot be discriminated or biased against in the workplace. In the United States, employees are free from illegal discrimination based upon a protected class, not because they are entitled to their jobs. This is why issues can arise when employees have been discriminated against (and subsequently fired) as opposed to being “unfairly” let go. It is important to note the difference between unfair and illegal actions.

Sometimes, employees who have been fired will claim what is called “false reasoning” for their dismissal and bring their former employer to court. There are two kinds of court cases based on interpretation of the law in question: federal and common law. Discrimination of sex is an example of a federal law case. Although there is nothing specifically written in the law about sexual harassment, courts have included it in the law against sex discrimination. However, a company or employee can go to the courts and challenge the interpretation of the wording of a law and determinations. In human resources practices, one must be very careful with the specifics of a law and be sure to follow them before making crucial decisions when it comes to the workplace.

Common law court cases are the second type and occur either when someone affirms an implied agreement with their employer or the employer has done something awfully wrong to the employee. It is the court’s job to decide whether or not there is a legal theory to support an employee’s argument. An example of court theories include terms such as, “wrongful discharge,” “implied contract,” “invasion of privacy,” and “defamation.” These terms exist in state and local legal systems. Many states have their own recognized theories and interpretations of what those theories mean. Most of the time, these terms are used to describe a situation where an employee has indeed been fired for unreasonable and unlawful reasons. Comparably, some Canadian courts require that an employee must have reasonable notice prior to their firing.

It is very important to be aware of federal, state and local employment laws for anyone interested in receiving HR certification. When it comes time to consider firing an employee, you must do so with a legal reason behind your decision. In so doing, you protect yourself and your employer from legal action. HR certification will also provide you with the skills needed to protect the company from various litigation around other circumstances as well.

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The Globalization of Human Resource Practices

The Globalization of Human Resource Practices

 

*Dr.Padala Shanmukha Rao **Dr. N.V.S.Suryanarayana

 

The key to creating a consistent corporate culture across multiple locations is maintaining the critical balance between a strong corporate culture and local cultural differences. Purpose The report examines the changing roles the human resource (HR) function plays in a globally competitive marketplace and identifies the challenges of adapting to these roles. The objectives of this study were to:

Ø  Investigate how domestic and international companies conduct HR practices around the world.
Ø  Determine the top HR priorities for each organization type.
Ø  Determine the challenges that organizations face when trying to globalize their HR function and practices.
Ø  Determine what organizations are doing to institute a consistent corporate culture across all locations/offices.

 

Responses were gathered from 206 members of DDI’s HR Benchmark Group. Two-thirds of the respondent organizations had operations in multiple countries (international); the remaining third operated solely in one country (domestic). The globalization of HR is characterized by increasing levels of decentralization.

Ø  Half of all international organizations reported having one primary HR department with independent regional HR staff.
Ø  Many international (37 percent) and domestic (42 percent) companies reported using a more centralized approach—one primary HR department with dependent regional HR staff.
Ø  More than a third of domestic organizations reported having only a primary HR department with no regional HR staff.

 

Consistency of Human Resource Practices:

A majority of international (79 percent) and domestic (87 percent) organizations reported that their parent organizations are taking action to make HR practices more consistent across all locations/offices.

 

Ø  International organizations use consistent HR practices to help develop a common corporate culture (75 percent) and to improve the effectiveness of the HR function (73 percent).
Ø  Domestic organizations are creating consistent HR practices to improve both the effectiveness (81 percent) and the efficiency (71 percent) of the HR function.
Ø  Selection practices vary greatly across locations in international organizations. Selection practices that vary the most include:

 

§  Assessments (role plays and simulations).
§  Testing for selection purposes.
§  Internet advertising (recruiting).

 

Best Practices:

Organizations were asked to respond to the following: What is the most effective action your parent organization has taken to make HR practices more consistent across all locations/offices?

 

The following is a sample of responses:

Ø  Developed a long-term HR plan to ensure alignment of HR strategies/objectives with corporate objectives.
Ø  Created centralized reporting relationships around the globe.
Ø  Standardized assessment, development, and compensation practices.
Ø  Introduced practices to regions around the globe and allowed the HR function in each region the autonomy to do [its] job.
Ø  Created global policies/processes for data management, performance management, compensation, education, and development.
Ø  Tied regional accountability to performance management.
Ø  Shared HR best practices used in certain locations with all other locations.
Ø  Developed an HR mission statement.

 

Creating a corporate culture:

Many international companies (84 percent) indicated that their parent organization was trying to establish a corporate culture at all locations/offices that was consistent with its goals and vision. Most organizations (88 percent) reported that creating a corporate culture is difficult because, in certain locations, local cultures and customs have a moderate to great influence on the way business is conducted. Organizations have taken the following actions when trying to create a consistent corporate culture:

Ø  Communicated to all locations about a common corporate culture.
Ø  Allowed local cultures to maintain their identity in the context of the corporate culture.
Ø  Established common systems (e.g., accounting, marketing, MIS).
Ø  Provided management with education outlining how the company does business.
Ø  Created an organizational mission with input from all locations.
Ø  Created a written strategy outlining the corporate culture.

Human Resource Policies and Practices at Global Level

Human Resource Policies and Practices at Global Level

* Dr.Shanmukha Rao Padala & ** Dr.N.V.S.Suryanarayana

 

Concept of HR policies and practices:

            A policy is a plan of action. It is a statement of intention committing the management to a general course of action. When the management drafts a policy statement to cover some features of its personnel programmes, the statement may often contain an expression of philosophy and principle as well. Although it is perfectly legitimate for an organization to include its philosophy, principles and policy in one policy expression, it is desirable for a student of HRM to separate a principle from a policy. The following statement is an expression of a principle or an objective: ‘it is the intention of the company to provide a safe plant and a healthy working environment’.

            The statement is too general to be any use. A Policy statement on the other hand is more specific and commits the management to a definite course of action. The following is a policy: ‘our policy is to institute every practical method for engineering safety into our processes and equipment, to provide protective clothing where necessary, to train employees in safe operating procedures, and to vigorously enforce established safety rules. Our policy is to provide a healthy plant by giving adequate attention to cleanliness, temperature, ventilation, light and sanitation’.

            A policy does not spell out the detailed procedure by which it has to be implemented. That is the role of a procedure. A procedure is in reality a method for carrying out a policy. A policy should be stated in terms broad enough for it to be applicable in varying situations. Lower-level managers who apply a policy must be allowed some discretion in carrying out the policy. The circumstances between two departments or sections or nations vary. Before we are going to discuss about the HR policies at global level, it is necessary to discuss the concept of globalization and its impact on human resource management.

Nature of globalization:

            Globalization refers to the process of integrating world economies. However much governments desire to retain economic identities, the powerful trend to integrate national economies is sweeping across the global and counties are falling in line and embracing rapid globalization. Whenever it is the communist China or the communist party governed West Bengal in India, the anxiety to join world economies is the most emerging concept today. Evidence of globalization can be seen in the increased level of trade, investment glows and mobility of people across the globe. Also called internationalization, the momentum of globalization has been driven by several developments as explained below:

Drivers of Globalization:

            Companies seek to take advantage, by expanding their operations into foreign markets, in a number of ways. First, rapidly developing economies have huge markets. For companies, mostly in developed countries, which have been operating below capacities, the emerging markets offer immense opportunities to increase their sales and profits. Second, many multinational companies (MNCs) are locating their subsidiaries in low wage and low cost countries to reduce their cost of production.

            Third, changing demographics also add to increasing globalization. Demographic changes are more visible in India. The country has the largest number of young people in the world today. India has nearly 65 million children below 15 years age, and as many as 400 million youngsters below the age of 23 years. These young people will join the employable workforce in the next few years. Thus, creating a hung surge of productivity, incomes and savings. Indian has a large low-cost and skilled work force. This large labour poll is projected to limit increases in rates for the next 20 years. In addition, India has a high availability of engineers, producing over 400,000 every year, next only to China’s 4,90,000 and nearly 25 times that of Thailand’s 17,000. in addition to engineers, India produces 850,000 graduates every year and over 70,000 vocational skills certified professionals.

            Fourth, regional trading blocks are adding to the pace of globalization. WTO, EU, NAFTA, MERCOSUR and FTAA are few of the major alliances among countries. Trading blocks seek to promote international business by minimizing trade and investment barriers. Fifth, the declining trade and investment barriers have vastly contributed to globalization. Sixth, the most powerful instrument that triggered globalization is Technology. Revolution is probably the right word which can best describe the pace at which technology has changed in the recent past and is continuing to change. Significant developments have been witnessed in communication, transportation and information processing, including the emergence of the Internet.

The Global Picture:

When it comes to business, the world is indeed becoming a smaller place. More and more companies are operating across geographic and cultural boundaries. While most have adapted to the global reality in their operations, many are lagging behind in developing the human resource policies, structures, and services that support globalization. The human resource function faces many challenges during the globalization process, including creating a global mind-set within the HR group, creating practices that will be consistently applied in different locations/offices while also maintaining the various local cultures and practices, and communicating a consistent corporate culture across the entire organization. To meet these challenges, organizations need to consider the HR function not as just an administrative service but as a strategic business partner.

Companies should involve the human resources department in developing and implementing both business and people strategies. This type of partnership is necessary if an organization wants to change potentially inaccurate perceptions of HR and reiterate the HR function’s purpose and importance throughout its global environment. Organizations will also discover that HR can be invaluable in facilitating the development of a unifying corporate culture and finding and cultivating much needed leadership talent around the world.

The process of globalizing resources, both human and otherwise, is challenging for any company. Organizations should realize that their global HR function can help them utilize their existing human talent from across multiple geographic and cultural boundaries. International organizations need to assist and incorporate their HR function to meet the challenges they face if they want to create a truly global workforce.

 

Globalization and management:

            A significant yet subtle shift has occurred in the area of management practice. While management is well researched and documented in the western countries as also in the EU countries, it is not the same with the APAC group of countries. The skill or the cost advantages that drive globalization efforts also impact the way people are managed in corporates. The older ‘personnel management’ (Theory X) approach has given way to the ‘human resource management’ (Theory Y) approach. The autocratic style that fed by ‘hierarchical position conscious systems’ is being swiftly replaced by flat organization structures, driven by competency and a highly decentralized decision-making and problem-solving organizational hierarchies. The individual in a position of power, driving policies and processes have swiftly evolved into team-based collaborative management methods. Another landmark change in management methods initiated by globalization happened in the area of organizational leadership. A new generation of leadership skills, styles and methods have evolved. The straight-jacketed approach to certain defined ‘good and bad’ leadership styles has been replaced with multiple theories supporting a variety of leadership styles. Leadership today is associated with the particular phase in the life-cycle of an organization, it is industry specific and increasingly, leaders are hired to achieve a very specific objective for an MNC.

 

General challenges for global hr function:

 

Functions such as operations, sales, and marketing have generally made great progress in adapting to the global reality. However, the HR function has typically lagged behind in developing policies and structures that support globalization. The top challenges HR faces in the globalization process include:

 

Coordination of activities in many different locations.

Understanding the continual change of the globally competitive environment.

Building a global awareness in all HR departments/divisions.

Creating a multicultural HR team.

 

 

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HUMAN RESOURCE PRACTICES IN VOLUNTARY ORGANISATION

HUMAN RESOURCE PRACTICES IN VOLUNTARY ORGANISATION

*Shanmukaha Rao Padala     ** N.V.S.Suryanarayana *** Goteti Himabindu

 

Human resource practice aims at effective utilization of manpower for accomplishing the organization objectives. The vitality of the organization depends upon the quality of its human resource. Its effective utilization is a sine qua non of the rate of growth of any economy regardless of the structure and system of economy, and the governance.  No society and no nation can be proud of its human resource unless there is a systematic and sustainable development of capacities of its people and convert the human resource into human capital (Daleela,).  Not only potential and versatile but also it is a strategic resource, which can be fully utilized to generate income and wealth of a national without the active involvement of this resource. 

The former Indian Prime Minister Mr. Rajiv Gandhi stated that “The real strength of the country lies in the development of the human mind and body”.  It was also rightly expressed by an eminent philosopher of China, Kuang Chung Trum during the 7th century B.C. ‘if you wish to plan for a year, sow seeds, if you wish to plan for ten years, plant trees, if you wish to plan a life time development” (Billomeria). The Government of India has recognized the importance of HRD and has created a separate ministry under the control of a fuel fledged cabinet minister. The present study addresses a HR Practices in Voluntary organization to contribute to achieve organization’s success.

 

Objectives of the study:

The study has been carried out with the following specific objectives:

To given a brief profile of the selected voluntary organization namely Integrated Development through Environmental Awakening (IDEA) To examine the Human Resource practices in the selected voluntary organization. To assess the employees perception on HR Practices in selected voluntary organization.

 

Methodology:

The study is based on both primary and secondary data. The secondary data is collected from organization records, management reports and special project reports to understand the present state of organizations’ activities. Primary data is collected from the employees of the organization with the help of questionnaire. The total number of employees in the organization is 512. The employees are grouped into three categories based on the nature of work viz., manager, supervisors, and assistants from which 125 employees (around 25 per cent) are selected randomly.

 

HR Practices in IDEA:

   Integrated Development through Environmental Awakening is a voluntary organization and established in 1981. It is a research and development organization working for the sustainable development of tribals and for the protection of bio-diversity and environment in the North Eastern Ghats. The vision of the organization is to achieve comprehensive sustainable endogenous development through emotional integration and awakening on sociologically acceptable, economically viable, environmentally sound and culturally ethical lines. The mission is to facilitate tribals and rural communities to achieve endogenous development on above lines. The objective is socio-economic development and empowerment on sustainable lines.

   The organization mainly concentration on the development of Kondh, Poraja, Kotiya, Nooka Dora, Binjhal, Konda Dora, Gadaba, Bagatha, Koya, Konda Reddy etc., tribal communities and other incidental groups. The organization has been covered Andhra Pradesh and Orissa through its action and network zone approaches in about 500 tribal villages. It has been supported by NORAD- the Royal Norwegian Embassy, New Delhi for development of Orissa; ETC/COMPAS- Netherlands for agro, eco-cultural development programmes in Andhra Pradesh and Orissa, and Department of Science and Technology, Government of India for the herbal health and livelihood security programme in Araku valley of Andhra Pradesh.

   The organization philosophy emphasizes the need to build up emotional integration and awakening to achieve sociologically acceptable, economically viable, environmentally sound and culturally ethical lines of comprehensive sustainable endogenous development. This process is facilitating by organizing the target groups and project based core groups with a view to involvement of all cross sections of the community and traditional institutional functionaries, to achieve comprehensive sustainable endogenous development. The areas of activities of the organization are:

Indigenous Knowledge research, conservation and development with special reference to agriculture, environment, herbal health and nutrition for endogenous development. Sustainable eco and watershed development programmes. Gender development programmes. To help tribal communities to achieve self sufficiency, self reliance and empowerment so as to improve the livelihoods, food security and health and nutritional status on sustainable lines.

The achievements of the organization are broadly classified into three area viz., agriculture, environment and herbal health. The achievement is respect of agriculture is: traditional land and soil management, biological pest control, botanical pesticides, weed management practices documented, classified, tested and strengthened/revived and integrated with modern knowledge systems.

The environmental achievements are: mountain land and natural resource management related rituals and festivals revived and watershed problems controlled to a good extent and improved ecology and bio-diversity. Environmental related clan totemic concepts, traditional shifting cultivation regulatory mechanism revived. It results in the protection of about 76 floral and faunal species and 2.5 lakhs acres of forests from shifting cultivation and covering 3000 square kilometers in ANDHRA PRADESH and Orissa of North Eastern Ghats. These are the improvements of bio-diversity and contribution to control global warning (by controlling the fire from the shifting cultivation patches as a practice of tribals). As well the tribal forest based economy improved by six times, due to regeneration of forests, implementation of agro-forestry and sustainable agriculture on mountain lands.

   The achievements in respect of herbal health are: medicinal plants (about 2000 species) documented and a conservation unit (Kasturi) is established at institutional and village level for further research, testing and experimentations and training for revival and integration. About 12000 herbal healers have been federated as member in tribal traditional institutional functionaries’ network- Naikgotna. About 250 villages promoted herbal gardens, and 1000 ethno-veterinarian improved their skill and reviving their practices in the villages. Women groups have revived their traditional health and nutritional improvement practices by reviving the use of about 243 wild leaf vegetables, tubers and berries etc., and prepared their own nutritional food for children, pregnant women and lactating mothers with the combination of modern knowledge systems for nutritional improvement.

 

Employees’ perception on HR Practices in the Organization:

               Employees’ compensation, undoubtedly, is one of the major determinants of employee satisfaction in an organization. The compensation policy and the reward system of an organization are viewed by the employees as indicators of the management’s attitude and concern for them. Compensation is directly tied to the labour market. Remuneration is the compensation an employee receives in return for his or her contribution to the organization. Remuneration occupies an important place in he life of an employee.  It acts as the mainspring of motivation in the society. One of the biggest factors affecting industrial relations is the remuneration or compensation an employee receives for a fair day’s work. Majority of the union management disputes relate to remuneration. One of the main goals is attracting capable employees to the organization and personnel must perceive that the compensation offered is fair and equitable. An attempt is made in this study to find out whether the organization offer sufficient compensation to their employees or not and the employees perception in this regard are presented in Table.1. The table amply corroborates the fact that 58 per cent of the respondents under study are on the agreement side saying that the various compensation variables offered by the organization are good. Nearly 44 per cent of the employees under study disagreed, while around eight per cent remained neutral in this respect.

 

 

 

 

Table.1

Employees’ perception regarding the Compensation

 

Sl. No.

Statements

SA

A

N

D

SD

 TOTAL

1.

The organization remunerates proportionate to the employees abilities and work.

35

(28.0)

27

(21.6)

15

(12.0)

33

(26.4)

15

(12.0)

125

(100)

2.

The organization pay scale is the main motivating factor to work.

41

(32.8)

19

(15.2)

8

(6.4)

36

(28.8)

21

(16.8)

125

(100)

3.

The organization provides sufficient conveyance and transport allowance.

27

(21.6)

32

(25.6)

11

(8.8)

21

(16.8)

34

(27.2)

125

(100)

4.

Adequate incentives are always provided to good performers.

36

(28.8)

29

(23.2)

5

(4.0)

36

(28.8)

19

(15.2)

125

(100)

5.

The compensation system in the organization keeps up the morale of employees.

29

(23.2)

25

(20.0)

12

(9.6)

24

(19.2)

35

(28.0)

125

(100)

 

Overall Average Value

33.6

(26.88)

26.4

(21.12)

10.2

(8.16)

30

(24)

24.8

(19.84)

125

(100)

SA= Strongly Agree; A= Agree, N= Neutral; D= Disagree; SD= Strongly Disagree

 

 

Welfare implies the setting up of minimum desirable standards and the provision of facilities like health, food, clothing, housing, medical assistance, education, insurance, job security, recreation and so on. Such facilities enable the worker and his family to lead a good work life, family life and social life. Labour welfare also operates to neutralize the harmful effects of large-scale industrialization and urbanization. The objectives of welfare concept can be summarized as combination of humanitarian, economic and civil characteristics. The legitimacy of a nation or society is judged on the basis of its efforts to fulfill the needs and aspirations of its people and thus raise their standard of living. The prosperity or progress of any organization is also determined by the results achieved in providing satisfaction to its employees by meeting their needs in various spheres of life viz., economic, political and socio-cultural. The present situation in most of the organizations has reached to provide better compensation, welfare facilities, better health care and good work environment, better socio-cultural and social relevance of work-life as a concept in day dream.

Increased productivity of an industrial undertaking, indisputably, results from mental happiness of employees. Mental happiness of an employee in turn is a function of welfare facilities provided by the employer. Welfare facilities make the life of the employee comfortable and happy. The labour welfare covers a broad field and connotes a state of well-being, happiness, satisfaction, conservation and development of human resources. In the select organization, the study reveals that, a little over 65 per cent of the respondents opined that the company is following a good scheme of welfare facilities and collaborative environment for its employees, while around 10 per cent of the employees are neutral on this issue. However, one-fourth of the respondents are dissatisfied in this respect. It is clear from the above analysis that an overwhelming majority of the respondents have appreciated the welfare facilities provided by the organization (Table.2).

Table.2

Employees’ perception regarding Welfare Facilities and Social Relevance of Work Life in the organization

Sl. No.

Statements

VA

A

N

I

QI

TOTAL

1.

Rating of Welfare facilities given by Employees’ in their Organization

54

(43.2)

36

(28.8)

10

(8.0)

14

(11.2)

11

(8.8)

125

(100)

2.

The organization provides facilities like medical care, housing and other welfare facilities

31

(24.8)

17

(13.6)

14

(11.2)

49

(39.2)

14

(11.2)

125

(100)

3.

Places of posting of job are satisfying and convenient.

47

(37.6)

26

(20.8)

28

(22.4)

16

(12.8)

8

(6.4)

125

(100)

4.

The job provides desirable style of life with regard to habits and attitude.

51

(48.8)

49

(39.2)

3

(2.4)

13

(10.4)

9

(7.2)

125

(100)

5.

The job is trying to improve the quality of life i.e., it endeavours to make a better man

49

(39.2)

48

(38.4)

5

(4.0)

11

(8.8)

12

(9.6)

125

(100)

 

Overall Average Value

46.4

(37.12)

35.2

(28.16)

12

(9.6)

20.6

(16.48)

10.8

(8.64)

125

(100)

VA= Very much Adequate; A= Adequate, N= Neutral; I= Inadequate; QI= Quite Inadequate;

The performance of an organization is depending upon the sum total of the performance of its employees. The success of an organization will obviously depend on its ability to measure accurately the performance of its members and optimum utilization of its resources. The effective performance appraisal system is very much needed by every organization particularly in the light of changing situations. The respondent employees were asked on performance appraisal system implemented in the organization with a view to understand the extent to which they appreciate. The employees’ opinions on overall average value of various aspects of performance appraisal system are shown in Table.3. It is clear from the table that around 61 per cent of the employees are either strongly agreed or agreed in respect of performance appraisal system implemented in the organization, whereas around 15 per cent of the respondents are neutral on this issue. There are, however, around one-fifth of the respondents are disagreed on this issue. From the foregoing analysis, it is evident that majority of employees of the organization have excellent positive opinion on the performance appraisal system implemented by organization.

Table 3

Employees’ perception regarding the Performance Appraisal System in the organization  

Sl. No.

Statements

E

G

N

P

VP

 TOTAL

1.

The organization is identify the need for Performance Appraisal System

45

(36.0)

23

(18.4)

27

(21.6)

18

(14.4)

12

(9.6)

125

(100)

2.

Good method of Performance Appraisal is adopted by the organization.

61

(48.8)

32

(25.6)

15

(12.0)

9

(7.2)

8

(6.4)

125

(100)

3.

Rewards for Efficient Performers

32

(25.6)

18

(14.4)

16

(12.8)

35

(28.0)

24

(19.2)

125

(100)

4.

Rating of Employees’ Performance

52

(41.6)

29

(23.2)

19

(15.2)

11

(8.8)

14

(11.2)

125

(100)

5.

Employees’ performance is linked to Organizational Goals

64

(51.2)

25

(20.0)

15

(12.0)

10

(8.0)

11

(8.8)

125

(100)

 

Overall Average Value

50.8

(40.64)

25.4

(20.32)

18.4

(14.72)

16.6

(13.28)

13.8

(11.04)

125

(100)

E= Excellent; G= Good, N= Neutral; P= Poor; VP= Very Poor

 

Training is widely understood as a communication directed at a defined population for the purpose of developing skills, modifying behavior and increasing competence. The training and development of employees is an essential aspect of creating a quality workforce in any organization. Before conducting the training program the organization must be identify the area in which training is required. The good training method increases the effectiveness of training and good evaluation helps the training manager to justify investment made on training. The training advantages are increased productivity, heightened morale, reduced supervision, reduced accidents and increased organizational stability and flexibility. The employees under the study have been asked to express their opinion on training and development programs conducted by the organizations and presented in Table. 4. The table is expressive of the fact, that a little over 41 per cent of the employees under study have strongly opined on various aspects of training and development in the organization is very good, while a little over one-fourth of the respondents have supported the view of the above respondents, whereas nearly 10 per cent of the employees under study, who are silent. However, 24 per cent of the respondents have expressed otherwise. From the foregoing analysis it can be concluded that the training and development programs in the organization is more satisfactory.

 

Table. 4

Employees’ perception regarding the Training and Development Programs in the organization

 

Sl. No.

Statements

VG

G

N

D

SD

 TOTAL

1.

The organization identifies the need for Training Programmes.

58

(46.4)

29

(23.2)

15

(12.0)

12

(9.6)

11

(8.8)

125

(100)

2.

Arranged of Training Programmes in the organization

64

(51.2)

25

(20.0)

15

(12.0)

10

(8.0)

11

(8.8)

125

(100)

3.

Usefulness of Training Programmes

49

(39.2)

45

(36.0)

6

(4.8)

14

(11.2)

11

(8.8)

125

(100)

4.

  Employees’ Opinion about the Study Material Provided in Training Programmes

56

(44.8)

32

(25.6)

11

(8.8)

16

(12.8)

10

(8.0)

125

(100)

5.

Employees Opinion on the availability of Separate Training Center

31

(24.8)

27

(21.6)

15

(12.0)

33

(26.4)

19

(15.2)

125

(100)

 

Overall Average Value

51.6

(41.28)

31.6

(25.28)

12.4

(9.92)

17

(13.6)

12.4

(9.92)

125

(100)

VG= Very Good; G= Good, N= Neutral; D= Dissatisfied; SD= Strongly Dissatisfied

Conclusions:

 

               The human resource practices can play a major role in achieving organizational goals and objectives, that can add value by ensuring that the right workforce has been engaged, which would produce the right operational outcomes, enabling the organization to achieve its intended objectives. In this study, the employees are very much satisfied regarding various aspects of HR practices. But in respect of compensation the organization should do something beyond imparting Even though the majority of the employees are satisfied in respect of the compensation, there is a need to do something beyond imparting compensation management practice in the organization.

 

   Reference:

Daleela, V.N., “HRM for Indian Economy”, The Indian Journal of Commerce, Vol. XXV, Feb1971, pp.9-10. Rajiv Gandhi, “Times of India”, Speech at Amethi, New Delhi, April 6, 1986, p.1. Billomeria, R.P. and Singh N.K., “Human Resource Development”, Vikas Publishing House, New Delhi, 1985, p.12. Mathur, B.L., “Human Resource Development”, Ajantha Publishers, Jaipur, 1988. Barber D., “The Practice of Personnel Management”, Institute of Personnel Management, London, 1979. Cascio., W.G., “Managing Human Resources”, MC Graw Hill Publications, New York, 1986. Paul Pigors and Charles A. Myers., “Personnel Administration”, New York, McGraw Hill, 1961.

 

 

 

 

 

 

HUMAN RESOURCE ACCOUNTING (HRA) PRACTICES IN INDIA

Success of corporate undertakings purely depends upon the quality of human resources. It is accentuated that; Human element is the most important input in any corporate enterprise. The investments directed to raise knowledge; skills and aptitudes of the work force of the organization are the investments in human resource. In this context, it is worth while to examine and human resource accounting practices in corporate sector in India.

Human resource accounting is of recent origin and is struggling for acceptance.  .It is clearly said that, Human resources accounting is an accounting measurement system and a large body of literature has been published in the last decade setting for the various procedures for measurement.  At the same time the theory and underlying concepts of accounting measurement have received sizeable attention from academics and a substantial body of literature has developed. The conventional accountings of human resources are not recognized as physical or financial assets. 

  Though Human Resources Accounting was introduced way back in the 1980s, it started gaining popularity in India after it was adopted and popularized by NLC.  Human Resources accounting, also known as Human Asset Accounting, involved identifying, measuring, capturing, tracking and analyzing the potential of the human resources of a company and communicating the resultant information to the stakeholders of the company.  It was a method by which a cost was assigned to every employee when recruited, and the value that the employee would generate in the future.  Human Resource accounting reflected the potential of the human resources of an organization in monetary terms, in its financial statements.

Even though the situation prevails, yet, a growing trend towards the measurement and reporting of human resources particularly in public sector is noticeable during the past few years.  BHEL, Cement Corporation of India, ONGC, Engineers India Ltd., National Thermal Corporation, Minerals and Metals Trading Corporation, Madras Refineries, Oil India Ltd., Associated Cement Companies, SPIC, Metallurgical and Engineering consultants India Limited, Cochin Refineries Ltd. Etc. are some of the organizations, which have started disclosing some valuable information regarding human resources in their financial statements. It is needless to mention here that, the importance of human resources in business organization as productive resources was by and large ignored by the accountants until two decades ago. 

During the early and mid 1980’s, behavioral scientists attacked the conventional accounting system for its failure to value the human resources of the organization along with its other material resources.  In this changing perspective the accountants were also called upon to play their role by assigning monetary value to the human resources deployed in the organization. Human Resource Accounting involves the dimension of cost incurred by the organization for all the personnel function.  Hence the issue is to be addressed is how to measure the economic value of the people to the organization and various cost based measures to be taken for human resources. The two main components of Human Resources Accounting were investment related to employees and the value generated by them.  Investment in human capital included all costs incurred in increasing and upgrading the employees’ skill sets and knowledge of human resources.  The output that an organization generated from human resources was regarded as the value of its human resources.  Human Resources accounting is used to measure the performance of all the people in the organization, and when this was made available to the stakeholders in the form of a report, it helped them to take critical investment decisions.All the models stressed that human capital was considered an investment for future earnings, and not expenditure.

   For valuing human resources, different models have been developed.  Some of them are opportunity cost Approach, standard cost approach, current purchasing power Approach, Lev and Schwartz present value of future earnings Model Flam holtz’s stochastic rewards valuation Models etc.  Of these, the model suggested by Lev and Schwartz has become popular.  Under this method, the future earnings of the human resources of the organization until their retirement is aggregated and discounted at the cost of capital to arrive at the present value.

Human resources accounting system consists of two aspects namely:

a)      The investment made in human resources

b)      The value human resource 

Measurement of the investments in human resources will help to evaluate the charges in human resource investment over a period of time.  The information generated by the analysis of investment in human resources has many applications for managerial purposes.  The organizational human performance can be evaluated with the help of such an analysis.  It also helps in guiding the management to frame policies for human resource management.  The present performance result will act as input for future planning and the present planning will have its impact on future result.  The same relationship is also applicable to the areas of managerial applications in relation to the human resource planning and control.Investment in human resources can be highlighted under two heads, namely,

 Investment pattern:

The human resource investment usually consists of the following items:-

1)      Expenditure on advertisement for recruitment

2)      Cost of selection

3)      Training cost

4)      On the job training cost

5)      Subsistence allowance

6)      Contribution to provident Fund

7)      Educational tour expenses

8)      Medical expenses

9)      Ex-gratia payments

    10) Employee’s Welfare Fund

All these items influence directly or indirectly the human resources and the productivity of the organization.

 Investment in current costs

After analyzing the investment pattern in the human resources of an organization the current cost of human resources can be ascertained.  For this purpose, current cost is defined as the cost incurred with which derives benefit of current nature.  These are the costs, which have little bearing on future cost.  Thus, the expenses incurred for the maintenance of human resources are termed as current costs.  Current cost consists of salary and wages, Dearness allowance, overtime wages, bonus, house rent allowance, special pay and personal pay.

 Amidst this background, it is significant to mention  that  the importance and value of human assets were  recognized in the early 1990s when there was a major increase in employment in firms in service, technology and other knowledge-based sectors.  In the firms in these sectors, the intangible assets, especially human resources, contributed significantly to the building of shareholder value.  The critical success factor for any knowledge-based company was its highly skilled and intellectual workforce.Soon after, the manufacturing industry also seemed to realize the importance of people and started perceiving its employees as strategic assets.  For instance, if two manufacturing companies had similar capital and used similar technology, then it was only their employees who were the major differentiating factor.  Due to the above development, the need for valuing human assets besides traditional accounting of tangible assets was increasingly experienced.

          From the above discussions, it is felt that, Human resource accounting provides quantitative information about the value of human asset, which helps the top management to take decisions regarding the adequacy of human resources. Hence, It is Concluded that, the Human Resources are an indispensable but often neglected element is thus to be fore grounded into the industrial area for the betterment of the economy.

 

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