📌 Introduction to Human Resource Management (HRM)

Human Resource Management (HRM) is the strategic approach to acquiring, developing, managing, and motivating an organization’s most valuable assets—its employees—to achieve competitive advantage and fulfill business objectives.

• Workforce planning and recruitment
• Training and development
• Performance management and appraisals
• Managing employee relations
• Ensuring legal compliance
• Looking after employee welfare

📌 Evolution of Human Resource Management

HRM has evolved from simple administrative functions to a vital strategic partner within organizations.

• Personnel Management (Early 20th century): Focused on administration, record-keeping, payroll.
• Human Relations Movement (mid-1900s): Emphasized employee motivation, satisfaction, and the influence of social factors at work.
• Strategic HRM (Modern): Aligns HR strategies with business strategy, emphasizing talent management, organizational culture, and innovation.

📌 Human Resource Planning (Workforce Planning)

• Definition: Anticipating the organization’s current and future staffing needs to ensure the right people are in the right jobs at the right time.

The HR Planning Process:

1. Analyze current workforce (skills, performance, gaps)
2. Forecast future demand (growth, market trends, strategic goals)
3. Analyze labor supply (internal promotions, external hiring)
4. Identify gaps and develop strategies (recruitment, training, redundancy planning)
5. Implement and monitor plans

Internal factors: Organizational structure, strategy, culture, management style.
External factors: Demographics, economic conditions, technology, labor market, government policies, cultural factors.

📌 Labour Turnover

• Labour Turnover (%) = (Employees Leaving ÷ Average Workforce) × 100
• Example: If 21 staff leave during the year and the average workforce size is 129, Labour Turnover = (21 / 129) × 100 = 16.3%
• Reasons for turnover (CLAMPS): Challenge, Location, Advancement, Money, Pride/Prestige, Security
• High turnover: Increases recruitment and training costs, affects productivity, damages morale—but can also allow for new skills and innovation

📌 Recruitment Process

• Identifying vacancies → Job analysis → Job description → Person specification
• Advertising vacancy (internal vs external methods)
• Receiving and reviewing applications, shortlisting
• Selection (tests, interviews, assessment centres)
• Job offer and induction

Internal recruitment: Promotes internal talent but limited applicant pool.
External recruitment: Broader choices, new ideas, but can be costly and riskier.

📌 Training and Development

• On-the-job: Induction, mentoring, coaching, rotation—practical, tailored, but may disrupt workflow.
• Off-the-job: Workshops, lectures, simulations, e-learning—expert instruction, focused, but costly and less contextual.
• Cognitive: Analytical and decision-making skills.
• Behavioural: Develops soft skills (communication, leadership, teamwork).

📌 Appraisal Methods

• Formative: Ongoing feedback for improvement.
• Summative: Periodic, judgement-based review (usually annual).
• 360-degree: Collects feedback from peers, subordinates, managers, and self.
• Self-appraisal: Employee evaluates own performance.

📌 Dismissal and Redundancy

• Dismissal: Due to employee conduct/performance (after due process).
• Redundancy: Due to changes in business needs, not the employee’s fault.

• Must be handled fairly, transparently, and legally to avoid disputes and protect employee rights.

📌 Changing Work Patterns and HR Strategies

• Teleworking/remote work: Increases flexibility but can cause isolation.
• Flexitime: Flexible hours benefit work-life balance but can complicate scheduling.
• Migration: Brings fresh skills, but integration and cultural adaption are needed.
• Outsourcing/Offshoring: Strategic cost-saving, but may risk quality and morale.
• Reshoring: Brings control and domestic jobs but may increase costs.

📌 Innovation, Ethics, and Cultural Differences in HR

• Innovation: Digital tools (AI, data analytics) transform recruitment, training, and performance management.
• Ethics: Fairness, transparency, privacy, non-discrimination, employee voice, and equity are central to HRM.
• Cultural differences: Affect HR policies for recruitment, rewards, feedback, and working style; managers must adapt for inclusion and effectiveness across regions.

🧠 Examiner Tip

• Know the labour turnover formula (it won’t be provided in the IB formula booklet!)
• Apply real-world business examples to justify points
• Balance both employer and employee perspectives in evaluation
• Use IB command terms (e.g., “analyse,” “evaluate,” “justify”) in answers
• Refer to ethical and cultural issues when appropriate

💼 IA Spotlight

Incorporate HRM practices and concepts—labour turnover, recruitment methods, and ethical considerations—when analyzing your chosen business for the IA. Use real business scenarios and data for credibility.

🔍 TOK Perspective

How does organizational decision-making in HR challenge what counts as evidence and fairness? In what ways do culture and context shape ‘best practice’ in HR? What ethical dilemmas arise around hiring, redundancy, and diversity?

🌐 EE Focus

Consider narrowing your EE topic to areas like the impact of HRM innovations or cross-cultural management practices, or evaluating the effects of remote work on organizational effectiveness.

❤️ CAS Link

Organize workshops for peers on resume building, interview preparation, or researching HR practices in local businesses. These activities integrate curriculum concepts with real-world service.

🌍 Real-World Connection

COVID-19 accelerated trends in teleworking and digital HR management. Companies globally have reshaped hiring and training practices—knowledge of these shifts is vital for business students!