HRM vs Personnel management.

Human resource management past and present

Human resource management has changed a lot in the past 100 years. Previously, HRM was called personnel administration or personnel management, that is, it had to do with the staff or workers of an organisation. It was mainly concerned with the administrative tasks that have to do with organising or managing an organisation, such as record keeping and dealing with employee wages, salaries and benefits. The personnel officer (the person in charge of personnel management) also dealt with labour relations.such as problems with trade unionsor difficulties between employers (those who employ workers) and their employees. Before we look at the role of HRM in organisations today, we will examine the way people were managed in organisations in the past.


Definition 

Personnel Management - Personnel Management is thus basically an administrative record-keeping function, at the operational level. Personnel Management attempts to maintain fair terms and conditions of employment, while at the same time, efficiently managing personnel activities for individual departments etc. It is assumed that the outcomes from providing justice and achieving efficiency in the management of personnel activities will result ultimately in achieving organizational success. 

Facts [+]

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The U.S. Office of Personnel Management (OPM) is the world's largest HR department. OPM provides HR services for the federal governments workforce of nearly 2.8 million workers. It's staff carry out the tasks to recruit, interview, and promote employees; oversee merit pay, benefits and retirement programs; and ensure that all employees and applicants are treated fairly and according to the law.

To set the COLA [cost-of-living allowances] rates, the Office of Personnel Management (OPM) surveys the prices of over 300 items, including goods and services, housing, transportation, and miscellaneous expenses. OPM conducts these surveys in each of the COLA areas and in the Washington, DC, area. 

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Human resource management is concerned with the development and implementation of people strategies, which are integrated with corporate strategies, and ensures that the culture, values and structure of the organization, and the quality, motivation and commitment of its members contribute fully to the achievement of its goals. 

HRM is concerned with carrying out the SAME functional activities traditionally performed by the personnel function, such as HR planning, job analysis, recruitment and selection, employee relations, performance management, employee appraisals, compensation management, training and development etc. But, the HRM approach performs these functions in a qualitatively DISTINCT way, when compared with Personnel Management. 

Main Differences between Personnel Management and HRM 

HRM has a long history of growing from a simple welfare and maintenance function to that of a board level activity of the companies. In recent years, the focus on people management from human capital/intellectual capital perspective is also shaping firmly. However, the hard fact is that this growth can be generally witnessed in management literature and rarely in practice. Peripheral observation of people management in organization can mislead the observers since, hardly there could be any organization that is yet to rename its old fashioned title of industrial relations/personnel/welfare/administration department into HRM department. But, in practice, these organizations continue to handle the people management activities the way they had been handling earlier. The reasons for this could be many and varied. Among them, the potential reason is lack of clear understanding about the differences between personnel/IR and HRM. 

Professor John Storey brilliantly portrayed these differences in 27 areas of people management in 1992 in his book titled Developments in the Management of Human Resources. These differences are illustrated in Table 

Dimensions	Personnel and IR	HRM
Beliefs and assumptions
1. Contract	Careful delineation of written contracts	Aim to go beyond contract
2. Rules	Importance of devising clear rules/mutually	'Can-do' outlook; Impatience with 'rule'
3. Guide to management action	Procedures	Business-need'
4. Behaviour referent	Norms/custom and practice	Values/mission
5. Managerial task vis-a-vis labour	Monitoring	Nurturing
6. Nature of relations	Pluralist	Unitarist
7. Conflict	Institutionalized	De-emphasized
Strategic aspects
8. Key relations	Labour management	Customer
9. Initiatives	Piecemeal	Integrated
10. Corporate plan	Marginal	Central
11. Speed of decision	Slow	Fast
Line management
12. Management role	Transactional	Transformational leadership
13. Key managers	Personnel/ IR specialists	General/business/line managers
14. Communication	Indirect	Direct
15. Standardization	High (e.g. 'parity' an issue)	Low (e.g. 'parity' not seen as relevant)
16. Prized management skills	Negotiation	Facilitation
Key levers
17.  Selection	Separate, marginal task	Integrated, key task
18. Pay	Job evaluation (fixed grades)	Performance-related
19. Conditions	Separately negotiated	Harmonization
20. Labour-management	Collective bargaining contracts	Towards individual contracts
21. Thrust of relations with stewards	Regularized through facilities and training	Marginalized (with exception of some bargaining for change models)
22.  Job categories and grades	Many	Few
23.  Communication	Restricted flow	Increased flow
24.  Job design	Division of labour	Teamwork
25.  Conflict handling	Reach temporary truces	Manage climate and culture
26. Training and development	Controlled access to courses	Learning companies
27.  Foci of attention for interventions	Personnel procedures	Wide ranging cultural, structural and personnel strategies