Principles of HRM

Everything you need to know about the Principles of HRM. Principles are those fundamental rules which guide the management in formulation of policies.

In their pioneering piece of work titled “In Search of Excellence”, Peters and Waterman (1982) emphasized that in order to achieve productivity through people, the management should put into practice the three fundamental values of “treating them as adults, treating them with dignity and treating them with respect.”

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Principles of HRM – 10 Fundamental Principles

Principles are those fundamental rules which guide the management in formulation of policies. Principles of personnel management are also the rules which help the personnel managers to conduct and direct the personnel policies in a proper way.

Sound principles help them in developing good human relations. C.H. North Cott has given four principles of personnel management.

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According to George D. Hells, they are seven in number, while Labour Management Institute of England has put-forth nine principles, but we are not going into controversy of numbers and we shall discuss main principles here in brief –

1. Principle of Scientific Selection:

For the proper coordination between work and workers it is necessary to have a right person for the job so that the question of inability of the person will not arise and workers will be able to get and do work according to the interest. The candidates are to be selected as per their merit. Qualification, experience, and achievements of candidates in past are to be considered. The partial selection is to be avoided.

2. Principle of Effective Communication:

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There must be effective medium of communication between the management and the workers. Communication means that, orders of higher authorities are conveyed in a proper way. If this arrangement is not effective then there arises complex problems like mistrust, hatred and ill-will and this in turn affects the production of the organisation.

3. Principle of Maximum Individual Development:

This principle stresses on the personnel development of every person working in an organisation. By this principle, workers are able to fulfil the objectives of an organisation with the minimum cost, hence giving them occasion to develop, themselves to the maximum extent of their capabilities. Their ability, productivity and efficiency could be used for the concerned objectives.

4. Principle of High Morale:

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It is essential to have a high morale for the workers organisation and work. With this purpose, ideal wage policy should be offered in the organisation. The high morale would be in position to create positive attitude and sense of motivation. There two things are very important for achieving the objective in time and more effectively.

5. Principle of Team Spirit:

Team spirit must be developed in the workers. They should work collectively and they should feel collective responsibility for the execution of the objectives of the organisation, with this intention, they must have the sense of the cooperation, unity and mutual trust. It is only team spirit that keeps the members united to shoulder the challenging tasks and fulfil them in time properly.

6. Principle of Dignity of Labour:

Personnel management should work specially on this principle so that the labourers feel proud of their work. Sentiments like ‘work is worship’ should be developed in them and for this they should be appraised with their work. With this purpose, the principles of the division of work and specialisation will prove helpful.

7. Principle of Joint Management:

This principle emphasises the idea of labour partnership in the business. In the age of industrial democracy, it is better to give to the labour his share in management. This creates responsibility in labour with increasing mutual faith and friendship. This will help to foster labour relations. The morale of people at lower level would be high and they would be satisfied. This situation can motivate them to give their best output at work.

8. Principle of Contribution to National Prosperity:

Personnel management should develop the sense of patriotism in labour by which organisation will be successful in achieving its objectives and success of individual organisation is ultimately the success of the nation as a whole. When everyone perform his task at full capacity then only the best result is possible. Collectively it would lead to prosperity of the national as a whole.

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9. Principle of Fair Reward:

Labour should be given proper compensation for the work. This develops industrial peace. History itself shows that all strikes, lockouts and breakages in the Indian factories are because of the dissatisfaction of the workers arising mainly due to improper way of rewarding the workers for their work. The impartial approach should be there in selecting the candidates for reward. It should be on performance achieved basis.

10. Principle of Effective Utilisation of Human Resources:

The development of personnel management is for the effective use of the human resources. It is needful that man should be thought as man. He should be asked to do the work that he can do and for his development proper training be provided. A sentiment of arbitrariness should be developed among then.

Principles of HRM – Top 8 Principles

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The success of HRM depends on the manner in which HR policies and procedures are framed, implemented, and governed.

The effectiveness of HR policies depends on the following principles:

1. Individualistic Approach – People should be dealt with as individuals. This call for a clear understanding of what the employees feel about their work assignments, personnel policies, and all those decisions which affect their interest.

2. Make Employees Feel Worthwhile – It is important that employees are made to feel that they are valuable to the organisation. It is important to consider and respect the employees feeling of accomplishment, price and good relations with co-workers and management.

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3. Fair and Just Policies – The policies and practices should be fair and just. It is necessary to give equal opportunities to all the employees. Sanctions should also be applied uniformly.

4. Rewards should be Earned – The employees should be informed that they will not be given rewards; instead they should strive hard to earn ‘rewards’. In other words, rewards should be performance based and should not be demanded or given as a matter of right.

5. Access to Organisational Information – All employees have a right to organisational information as it facilitates timely execution of work. Denying information is similar to creating obstacles in the employees’ ways.

6. Judge the Strength – The HR manager should judge the strength and intelligence of the employees properly. This is necessary to avoid resentment and frustrations.

7. Equal Pay for Equal Work – All employees should be paid on the basis of equal pay for equal work. This approach has tremendous motivational value. This approach helps in improving the morale of the employees and keep them satisfy at their work.

8. Do what you Preach – The leaders should set examples before the subordinates. It is important to remember that actions are louder than words. Therefore, what is said and formulated in the plans should be done and followed in the same manner.

Principles of HRM – 10 Essential Principles:

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In his book titled “Human Resource Management in a Business Context,” Alan Price has suggested ten essential principles of HRM.

These are explained below:

1. Comprehensiveness – According to this principle, an HRM strategy in an organisation should include all aspects of people-management beginning from hiring to post-separation programmes.

2. Credibility – The principle of credibility implies that HR practices must develop trust between rank-and-file of employees and top management, and promote employees’ acceptance of HRM strategies.

3. Communication – This principle suggests that the objectives of the organisation and those of HRM must be effectively communicated to employees so that they could easily understand and accept them. Communication must also be transparent and free from barriers.

4. Cost effectiveness – The remuneration paid to the employees should be competitive and fair, and there should also be a system of promotion.

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5. Creativity – The competitive advantage of the company should flow from the unique strategies of HRM.

6. Coherence – Activities and initiatives undertaken by HRM should form a meaningful whole.

7. Competence – This principle holds that the organisation’s competence to achieve its objectives essentially depends on the competence of individuals.

8. Control – HRM policies and activities should ensure consistency with the organisation’s objectives.

9. Change – HRM strategy must rest on the premise that continuous improvement and development is indispensable for survival.

10. Commitment – This principle emphasizes that employees must be motivated to achieve organisation’s goals.

Principles of HRM – Widely Accepted Principles

Different experts and scholars have presented the principles of human management in different forms.

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But the following are the widely accepted principles of human resource management:

1. Principle of Maximum Individual Development:

According to this principle, the personnel administrator should always be careful in developing the personality of each individual. Each individual differs in nature and therefore management should recognise their individual ability and make use of such ability in an effective manner. If an act of the employer can adversely affect the personality of the individual, he should avoid such act. Maximum individual satisfaction should be the basis of the personnel policies.

2. Principle of Scientific Selection:

According to this principle, a scientific system of selecting the personnel should be developed in order to ensure the selection of the right type of persons for various jobs for this purpose, the techniques of psychology should be adopted. Workers should be selected after a careful weighing of the requirements of the jobs on the one hand and assessment and evaluation of the abilities and aptitudes of men on the other. This will avoid the wastage of resources and increase the productivity of employees.

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3. Principle of High Morale:

According to this principle, morale of workers should be kept high. High morale is indispensable for the effectiveness and efficiency of the organisation. High morale creates cooperative attitude among the workers and makes them committed to the organisation. For this purpose, workers should be motivated by monetary and non-monetary incentives such as ideal wage system, bonus, gratuity, better working conditions, facilities for training, labour welfare, social security schemes etc.

4. Principle of Effective Communication:

According to this principle, it is very necessary to establish an effective machinery of communication to manage the affairs of the concern effectively. Communication, machinery must establish two way traffic i.e. it must provide the liberty to both parties —management and workers — to convey their ideas, orders, opinions, grievances etc. An effective communication is a must to coordinate the efforts of various employees and the management.

5. Principle of Dignity of Labour:

According to this principle, labour should be given due regarded in the organisation. His work must be duly recognised so that his ego may be satisfied. For this purpose, non-monetary incentives should be provided along with monetary incentives.

6. Principle of Team Spirit:

According to this principle, there should be a team spirit in workers i.e., workers should feel their joint responsibility. Efforts should be made to let the workers feel that their work as a team can only accomplish the goals of the organisation. For this, employees should be educated so that they may extend their cooperation to the organisation.

7. Principle of Fair Reward:

According to this principle, the workers should get fair reward for their work. This is necessary to maintain better industrial relations and to increase the workers’ efficiency. For this purpose, performance appraisal should be the basis for wage determination.

8. Principle of Co-partnership:

According to this principle employees should be given a due participation in the management of the enterprise so that they may realise that they are partners in the prosperity of the organisation and their interest and the interest of management are the same. Workers should be educated to make them realise that their efforts alone can contribute to the prosperity of the organisation and of the country.

9. Principle of Effective Utilisation of Human Resources:

The personnel management has been evolved to utilise the available human resources in the best manner possible so as to achieve the organisation objectives effectively. Personnel management is an art to get the work done by the people, to get the desired result. For this purpose, workers should be given humanly treatment in the organisation.

10. Principle of Contribution to National Prosperity:

Personnel management should ensure that employees contribute to the prosperity of the organisation and of the country also. For this purpose personnel management should develop the sense of patriotism in labour and educate them so as to make them valise that their efforts alone can contribute to the prosperity of the organisation and of the country.

Principles of HRM – 4 Basic Principles

Human Resource Management is an approach to the management of people based on four basic principles:

Firstly, human resources are the most important assets an organization has and their effective management is the key to its success.

Secondly, this success is most likely to be achieved if the personnel policies and procedures of the enterprise are closely linked with, and make a major contribution to, the achievement of corporate objectives and strategic plans.

Thirdly, the corporate culture and the values, organizational climate and managerial behavior that emanate from that culture will exert a major influence on the achievement of excellence. This culture must, therefore, be managed, which means that organizational values may need to be changed or reinforced and continuous efforts from the top to the bottom of the organizational hierarchy, will be required to get them accepted and acted upon.

Finally, HRM is concerned with integration, getting all the organizational members involved so as to make them work together with a sense of common purpose.

As Tom Peters wrote in, A Passion for Excellence – “Trust people and treat them like adults, enthuse them by lively and imaginative leadership, develop and demonstrate an obsession for quality, make them feel they own the business, and your workforce will respond with total commitment”.

Thus, HRM involves getting the organization right, providing effective motivation and leadership, obtaining and developing the right people, paying and treating them fairly, and getting them involved in working productively. In the broadest sense, it denotes satisfaction, development, fulfillment and happiness of all the people who work in an organization.

The human environment within an organization has to be increasingly viewed as an integral whole. The primary objectives of the people who work in the organization are satisfaction of their own physical, social and psychological needs, the organizational objectives being only of secondary importance to them, though some degree of achievement of which is necessary for the achievement of their own personal or group objectives.

Thus, to summarize, HRM is a strategic approach to the structure, motivation, development and management of an organization’s employees, based on four basic principles –

i. The effective management of human resources is the key to an organization’s success.

ii. Success is most easily achieved if personal policies are closely linked with the organization’s corporate objectives.

iii. Managerial behavior and the organizational climate exert a major influence on the achievement of excellence.

iv. The total integration of manpower is essential to success.

In the words of Lee Lacoca, the world famous international business tycoon,”… all business operations can be reduced to three words; people, product and profits. People come first. Unless you’ve got a good team, you can’t do much with the other two”.