By Taslim Ahammad:
Human Resource Management has come up with an extension over personnel management, which eradicated the shortcomings of the personnel management. It is quite essential in this era of intense competition where every organisation have to put their manpower and their needs first.
Personnel management – Personnel management may define as an administrative specialisation that focuses on hiring and developing employees to become more valuable to the company. Hence, it is an administrative function which exists in an organisation to ensure right personnel at right organisational activity. It is a traditional approach of managing employees which focuses on obedience to policies and rules of organisation.
Human resource management – Human resource management is a modern approach of managing people at workplace which focuses on acquisition, development, utilization and maintenance of human resource. The term human resources were first used in the early 1900s, and then more widely in the 1960s and then 1980s, to describe the people who work for the organization, in aggregate. Moreover, is the process of recruiting, selecting, inducting employees, providing orientation, imparting training and development, appraising the performance of employees, deciding compensation and providing benefits, motivating employees, maintaining proper relations with employees and their trade unions, ensuring employees safety, welfare and health measures in compliance with labour laws of the land.
Shifting paradigm of personnel management to HRM:
The most important role of HRM can be from the transformation of the personnel management function from concentrating on employee welfare to managing workforce in a way, that meet organisational and individual goals and providing employees with internal and external rewards. Therefore, today human resource management (HRM), previously had known as personal management, deals with formal system for the management of the people within the organisation. Many well-known companies report that they are trying to transform their workforce into a source of competitive advantage.
Stages of shifting of personnel management to HRM:
Firstly, effective HRM focus on linking HRM problems to the overall strategy of the organisation, the most effective HRM will design policies and practices for such corporate policies and strategies which can change an organization’s culture
Secondly, building strong cultures is a way of promoting particular organisational goals, strong culture’ is aimed at uniting employees through a shared set of managerially agreed of values e.g., quality, service, innovation and so on.
Thirdly, the attitude that people are a variable cost is ineffective HRM, replaced by the view that people are resource and that as social capital can be developed and can contribute to competitive advantage. It is accepted that competitive advantage is gained through well-educated and trained, motivated and committed employees.
Finally, the view that the interests of employees and management or shareholders are divergent which was substantially true in the past is giving way to the view that this need not necessarily be so.
Difference between personnel management and HRM
Difference in nature – Another dimension of the difference is the proactive nature of human resource management compared to the reactive nature of personnel management.
Personnel management remains aloof from core organizational activities, functions independently, and takes a reactive approach to changes in corporate goals or strategy. Human resource management remains integrated with corporate strategy and takes a proactive approach to align the workforce toward achievement of corporate goals.
Difference in application -Personnel management is an independent staff function of an organization, with little involvement from line managers, and no linkage to the organization’s core process. Human resource management, on the other hand, remains integrated with the organization’s core strategy and functions. Although a distinct human resource department carries out much of the human resource management tasks, human resource initiatives involve the line management and operations staff heavily.
Personnel management also strives to reconcile the aspirations and views of the workforce with management interest by institutional means such as collective bargaining, trade union-based negotiations and similar processes. This leads to fixation of work conditions applicable for all, and not necessarily aligned to overall corporate goals.
In general, following are the major differences between Personnel Management and Human Resource Management:
Personnel management is a traditional approach of managing people in the organisation. Human resource management is a modern approach of managing people and their strengths in the organization.
Personnel management focuses on personnel administration mainly, however, HR management focuses on acquisition, development, motivation and maintenance of human resources in the organization.
Personnel management assumes people as an input for achieving desired output. Human resource management assumes people as an important and valuable resource for achieving desired output.
In personnel management, personnel function is undertaken for employee’s satisfaction. Under human resource management, administrative function is undertaken for goal achievement.
In personnel management, job design is done on the basis of division of labour. Under human resource management, job design function is done on the basis of group work/team work.
Decision Making is slow in Personnel Management, but the same is comparatively fast in Human Resource Management.
In personnel management, the negotiations are based on collective bargaining with the union leader. Conversely, in HRM, there is no need for collective bargaining as individual contracts exist with each employee.
In personnel management, the pay is based on job evaluation. Unlike HRM, where the basis of pay is performance evaluation.
Personnel management primarily focuses on ordinary activities, such as employee hiring, remunerating, training, and harmony. On the contrary, human resource management focuses on treating employees as valued assets, which are to be valued, used and preserved.
In this day and age, it is very challenging to retain and maintain good employees for a long time as they are fully aware of their rights and any organisation cannot treat them like machines. So, HRM has been evolved to unite the organisation with their employees for the attainment of a common goal.
Taslim Ahammad, Assistant Professor
Bangabandhu Sheikh Mujibur Rahman Science and Technology University, Gopalganj, Bangladesh