Human Resource Management: Roles, Functions, HRM Models & Nepalese Practices

What is Human Resource Management (HRM)?

Human Resource Management (HRM) is the process of managing people in an organization to achieve its goals efficiently. It involves planning, recruiting, selecting, training, motivating, and retaining employees while ensuring legal compliance.

Key Functions of HRM

mindmap
  root((HRM Functions))
    Recruitment & Selection
    Training & Development
    Performance Appraisal
    Compensation & Benefits
    Employee Relations
    Legal Compliance

1. Recruitment and Selection

Recruitment is the process of attracting candidates, while selection is choosing the best fit for the job.

Steps in Recruitment

1. Job Analysis – Define job roles, responsibilities, and required skills.
2. Job Description – Document job duties, qualifications, and working conditions.
3. Sourcing Candidates – Use internal (promotions) or external (job portals, campus hiring) methods.
4. Screening & Interviewing – Shortlist candidates based on resumes and conduct interviews.
5. Selection & Hiring – Finalize the best candidate after background checks.

Real-World Example: Daraz Nepal

• How Daraz recruits engineers?
  • Uses campus hiring (PU, IOE) for fresh graduates.
  • Conducts technical + HR interviews to assess problem-solving skills.
  • Offers competitive salaries + stock options to retain talent.

2. Training and Development

Training improves job performance, while development focuses on long-term career growth.

Types of Training

3. Performance Appraisal

Evaluates employee performance to improve productivity.

Methods of Appraisal

flowchart TD
  A["Performance Appraisal Methods"] --> B["Graphic Rating Scale"]
  A --> C["Trait Appraisal"]
  A --> D["360-Degree Feedback"]
  A --> E["Management by Objectives (MBO)"]

Worked Example: Nabil Bank’s Engineer Performance Review

• KPIs: Code quality, project completion time, client feedback.
• Rating Scale: 1 (Poor) to 5 (Excellent).
• Action: If an engineer scores <3, they get additional training.

4. Compensation and Benefits

Fair salary + benefits motivate employees.

Types of Compensation

5. Employee Relations & Legal Compliance

HR must ensure fair treatment and legal adherence.

Key Laws in Nepal

• Labor Act, 2017 – Minimum wage, working hours (max 8 hrs/day).
• Social Security Act – Pension, medical benefits.
• Equal Remuneration Act – No gender pay gap.

Case Study: NTC’s Labor Dispute (2022)

• Issue: Engineers demanded better safety measures.
• Solution: NTC formed a grievance committee and improved workplace safety.

In the Real World

1. Daraz’s HR Strategy

   • Uses AI-based recruitment tools to shortlist candidates.
   • Offers flexible work hours to retain tech talent.

2. Nabil Bank’s Training Program

   • Sends software engineers to CIMA for financial management skills.
   • Uses MBO (Management by Objectives) for performance tracking.

3. NTC’s Performance-Based Pay

   • Engineers get raises based on project success rates.
   • Example: A team completing a high-speed fiber project gets a 10% bonus.

Exam Tip

• Theory Questions (30%): Define HRM, explain recruitment steps, compare training methods.
• Case Studies (40%): Analyze NTC’s labor dispute or Daraz’s hiring process.
• Short Answers (30%): Define 360-degree feedback, list Nepal’s labor laws.

Key Formula to Remember: $$\text{Employee Turnover Rate}=\left(\frac{\text{Number of Employees Left}}{\text{Average Number of Employees}}\right)\times 100$$

Final Thought: "HRM is not just about hiring—it’s about building a workforce that drives innovation, like how Nepal’s tech startups rely on skilled engineers to compete globally."