The Business Management Of Human Capital Commerce Essay

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From the last 20 years it has seen the rise for the human resource management. In the mid 1980's in the UK and USA, it became familiar and fashionable and started using in organisation. In mid1980s in the UK and USA, it became familiar and fashionable and started this strategy. And in 1990's it started courses of HRM in universities and colleges. Human resource management is based on ideas and techniques on how they can manage to enhance workers motivation, productivity and performance of employees rule and regulation. It covers work and employment. It includes these factors equal opportunities, motivation, employee relations, training, and recruitment in work, power influences, career development and rewards. HRM has a great impact to an enterprise success and performance. cited on 22/02/10



Human Resource Management (HRM) is the function within an organization that focuses on recruitment of, management of, and providing direction for the people who work in the organization. Human Resource Management can also be performed by line managers.

Human Resource Management is the organizational function that deals with issues related to people such as compensation, hiring, performance management, organization development, safety, wellness, benefits, employee motivation, communication, administration, and training. cited on 23/02/10


Strategic human resource management can be defined as the linking of human resources with strategic goals and objectives in order to improve business performance and develop organizational culture that foster innovation, flexibility and competitive advantage. In an organisation SHRM means accepting and involving the HR function as a strategic partner in the formulation and implementation of the company's strategies through HR activities such as recruiting, selecting, training and rewarding personnel.


The main aim of human resource management is to develop an understanding of management functions can affect the performance of a business.

Human resource is one of the important features in many businesses - especially in service-based industries. cited on 12/02/10

HRM has a number of different standards and is best described as a philosophy of people management rather than a focused methodology

Human Resource Management ("HRM") is a way of management that people links related activities to the strategy of a business or organisation. HRM is often referred to as "strategic HRM". It has several goals:

- To meet the needs of the business and management

- To find ways for human resources to "add value" to a business;

- To help a business gain the commitment of employees to its values, goals and objectives.

It has been applied to theory as well as practise. We can say how many employees required? What markets should do in competitive market like what strategy they can apply. The technological change occurs in the competitive world. cited on 17/02/10

Objectives of HRM

An objective of human-resource management is to which achieve the goals to an individual or group activity in an organization. Personnel management are influenced by company's objectives and its goals. Human resources is used to utilize their resources and for the accomplishment of organizational objectives. The objectives of HRM are to meet the needs, values and dignity of individual employees.

To create and utilize a motivated workforce.

To establish and maintain organizational structure.

To secure individual or groups within the organization by co-ordination of the individual or group goals.

To create facilities and opportunities for individual group development

To attain an effective utilization of human resources

To maintain high employees morale and human relations. cited on 20/02/10

Features of human resource management.

Scope/goals of human resource management

Human resource planning

The element involves determining the organizations human needs, strategies and philosophies. It includes the external and internal factors like skills needed, number of vacancies, trends in the labour market, etc.

Recruitment and selection

Recruitment is concerned with developing their potentials of employees. Selection is the process of matching people and their career needs and capabilities with the jobs and career paths. It ends with the best hiring of candidate.

Training and development

This involves identification potentials through a planned learning process. The competencies are to be developed to individuals to perform current as well as future jobs.

Career Development

It is a process of achieving an needs of organizational and individual ones.

Job Design

This feature defines the tasks, authority and systems of job. It also ensures integration of individual jobs across the unit.

Performance Management Systems

It aims at ensuring that every individuals effort support the goals of the organization. The performance management systems link between individuals and organizational goals.

Compensation and Benefits

In the workforce the element focuses on a fair, consistent and equitable compensation.

Organizational development.

This element assures healthy inter and intra relationships. It helps work groups in initiating and managing change.

Employee Assistance

The focus of this element is to provide problem solving/counselling to individual employees. The purpose is to help employees in overcoming personal and job-related problems.

Labour Relations

This variable assures healthy union-organization relationship. It aims at creating an environment of industrial peace and harmony.

Research and information systems and audit

This element not only evaluates personnel policies but also highlights the need and areas of change.

Book: Human resource management by Prof. P.A.Noronha, pg no 2-4

Role/ functions of human resource management.

The inception function

This function deals with recruitment and selection of human resource. It involves that candidate should have potential,, skills, abilities. It facilitates fixation of performance standards, pay rates and invoking disciplinary action.

Development function

To make the new employees fully productive. It covers training, employee development, organization development and career development. The focus is on assisting employees to acquire better and improved skills for handling current jobs making the job adaptive to external influences and designing programmes to assist employees in advancing in their work lives.

Motivation function

This function aims at improving performance. This needs proper job designing, an optional of an effective performance appraisal machinery and introduction of a fair and just system of incentives and compensation.

Employment function

The main trust of this function is to promote the activities related to the inception function by advertising the job effectively. It just co-ordinates the efforts with line management by handling the routine paper work associated with recruitment and selection.

Training and development

This function is the organizations internal change. To improve the organizational productivity the training is given to employees. It helps them in better career choice and in to achieve their desired goals.

Compensation and benefits function

It concerned with paying the employees and in administering their benefits package. The pay is based on consideration like skills, job responsibility, efforts and accountability. These considerations often result in a conflict.

Book: Human resource management by Prof. P.A.Noronha pg no2-4

Strategic HRM

Strategy determines the direction in which the organization is going in relation to its environment. The business strategy is concerned with achieving competitive advantage. The effective development and implementation of strategy depend on how strategic capability is implemented of the organization. Strategy is about implementation, which includes the management change, as well as planning. A strategy has number of meanings a plan, a pattern a perspective.

Concerns of Strategic HRM

HRM relating to organizational effectiveness and performance, changes in structure and culture and the management change. Human capital requirements and developments of process capabilities, to get things done effectively. The main concern of SHRM is executive leadership and positive patterns of labour relations.

Focus of SHRM

SHRM focuses on differentiating from on its competitors. Strategy decisions aim to make a major and long-term impact on the behaviour and success of the organization.

SHRM Models:

High involvement management

This approach involves treating employees in the enterprise whose interests are respected and who have a voice on matters that concern them. It is concerned with communication and involvement. The aim to create a climate it's between managers and the members of their teams in order to define expectations and share information on the organization's mission, values and objectives. It establishes mutual understanding between managing and developing people to ensure that it will be achieved.

High commitment management

One of the characteristics of HRM is on the importance of enhancing mutual commitment. High commitment management has been described as 'A form of management which is aimed commitment so that behaviour is primarily self regulated rather than controlled by sanctions and pressures external to the individual, and relations within the organization are based on high levels of trust.

High performance management

High performance involves the development of a number of interrelated processes that together make an impact on the performance of the firm through its people in such areas as productivity, quality, and levels of customer service, growth, profits, and ultimately the delivery of increased shareholder value. cited on 24/02/10

Benefits of Strategic Human Resource Management

It identifies the opportunities and threats to the company's success.

It provides a clear business strategy

To recruit, people and retain

To maintain high productivity

Developed issues are done systematically

To ensure surplus through competency. cited on 25/02/10

Trends in Strategic Human Resource Management

Human Resource Management professionals is increasingly faced with the issues of employee participation, human resource flow, performance management, reward systems and high commitment work systems in the context of globalization. Older solutions that worked in a local context do not work in an international context. Cross-cultural issues play a major role over here. These are some of the major issues that HR professionals and top management involved in SHRM are grappling with in the first decade of the 21st century:

Internationalization of market integration.

Increased competition, which may not be local or even national through free market ideology

Rapid technological change.

New concepts of line and general management.

Constantly changing ownership and resultant corporate climates.

Cross-cultural issues

The economic gravity shifting from 'developed' to 'developing' countries cited on 24/02/10

Examples of strategic human resource management


Palm Inc is governed by their basic goals and objectives. The company constantly invests in human resources development as specifically due to recession period. So it can increase the employee performance, performance appraisal, reduce turnover and motivate the employee. The target is for training and development. The palm inc companies five HRMs policies are divided into 5 policies:

Equal opportunity and employment practises.

Compensation and benefits of management.

Management and development of training.

Records disclosure and management

Performance development and management. cited on 23/02/10


It is a leading software company based in India. It was voted for the best employer in the country. This company was well known for its good practises on HR. The toughest selection process in the world. And the selected candidates were required to go through 14 weeks training. The first company has offered the ESPOS to its employees. This strategy was used by Infosys. cited on 23/02/10


It was a small producer of cooking oil in 1945 but it's a large diversified corporation. The main aim of a Wipro is to develop the necessary human resources. So it shaped a strong and distinctive organizational culture. Wipro's HR practises are related to 4 functions such as recruitment, training, performance appraisal and leadership development. cited on 23/02/10


Google believes in a people's policy in the company. Therefore the process becomes long over 1000 resumes to hire. HR is a special function for the organisation. It benefits

Corporate sponsored childcare


Dental care

Physical fitness

Maternity and paternity leave

Massage cited on 23/02/10


UCL's corporate goals are a global reputation for excellence in teaching and research. The HR strategy supports UCL's academic and the objectives laid out in its supporting strategies.

UCL aims to be safe and healthy workplace and believes in a diversity should be celebrated. cited on 20/02/10


Sainsbury has branches throughout the country. It's a leading company over US and UK food. The organisation applies HRM policies like a) human resources planning b) Recruitment and Selection

Training and development d) Performance Management Sainsbury operates the HR policy to all employees from top management level to lower management level. i.e. from top management managers to locally based managers. The objective meet its customer needs effectively and efficiently. cited on 21/02/10

Hospitality and tourism industry

In tourism and hospitality industry applied the HRM policies and procedures. Recruitment and selection is focused on this industry. HRM theory and practises, it focuses on this industry by looking at the employment practises of these industries and in practice the e.g. are boxed, reflective review questions, web links discussions and further reading.

Human resource management for the hospitality and tourism industries.

By Dennis Nickson


A company's policy is from a multiactivity operation into a more defined business can make changes for managers and staff. They involved more than 52000 staff into a focus group of meetings for all of their retail employees. They organisation started staff and union negotiations in 2003-04.

Mc Donald's

It also gives importance on the training and development of its employees. They also provide career opportunities to achieve their destiny. It offers flexibility at work. They give chance to a employees to work in management position it depends upon how well employees work.


The report discusses about Tesco's HR policy and strategy. The most important focus of tesco was of their logo "Every little helps to prove their commitment to employees as well as to customers. And because of this logo they proved to be very successful in organisation in UK. To be successful in a market, tesco is using HRM strategy and focuses on training. The organisation is involved in training. They have control on their training process after the initial induction process. Training has been a successful policy in the organisation to maximise the profits. 7/02/10


HR outsourcing, process-by, process has been around for many decades. But in the late 1990's recognized a strong desire for companies to embrace integrated business process outsourcing in hr it saw a unique opportunity. Accenture studied the market and noticed that in technology and revolutions underway in human resource management. By applying these innovations to BPO, it established. Accenture HR BPO services provided the most innovative, high quality, cost-effective HR services and an outsourced basis in the market place. Accenture HR BPO services innovative HR approach focused on making its clients high-performance organizations helped it evolve into a unique provider with its own professional identity and philosophy. "Accenture thinks about people matters". 8/02/10.


As global business competition moves from efficiency to innovation and from enlargement of scale to creation of value, management needs to be oriented towards the strategic use of human resources.  Strategic human resources management practices measures employee productivity and the ability of agencies to achieve their goals. By using personnel practices into the strategic planning process enables an organization to better achieve its goals and objectives. Combining human resource practices, all with a focus on the achievement of organizational goals and objectives, can have a substantial affect on the ultimate success of the organization. To manage future operations effectively, it is essential that companies produce "business leaders" and "innovators" through SHRM approach. Cited on 26/02/10