The Hindu Business Line : Shoring up human resources

FROM the time when the human resource function in a company was considered a service department, the human resources (HR) manager's role has changed and become central to the success of any organisation. HR is not just an internal function but an external one also, according to Mr Muthukumar Thanu, chairman, HR & IR sub-committee, Confederation of Indian Industry — Southern region (CII-SR).

According to him, the human resource function flows all along the value chain in any organisation and has become intrinsic to the working of all departments. Over the years, the HR function and HR management practices have changed as employees decide the fate of any business.

Various factors like globalisation and the increasing visibility of the information technology sector have also had an impact on HR practices. Globalisation requires that manufacturing companies maintain the highest standards of quality, while the increasing importance of the IT sector means that managing employee costs becomes a major issue. In the IT sector, staff costs account for as much as 40-50 per cent of expenditure, while in the manufacturing sector it could be 7-10 per cent.

In these circumstances, the HR manager's role has also evolved. The HR manager plays a major role not just in the recruitment process, but also in ensuring that the employees fit into the organisation and are kept motivated and challenged to perform to the best of their ability.

According to Mr Thanu, who is Group Vice President - HR, Murugappa group, a weak link earlier was that the HR function could not be benchmarked. However, over time even that has changed with a number of benchmarking models — be it in terms of compensation package or people satisfaction levels or recruitment costs or productivity levels — available.

Realising the importance of the HR function in an organisation, the CII-SR instituted an annual HR excellence award to improve HR practices and capabilities.

Mr Thanu said the CII-SR's HR Excellence Award was designed on a combination of the European Federation of Quality Management (EFQM) and Baldridge Business Excellence models.

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