Modern concept of human resource management has developed through a number of stages. The examination of the following stages show the transformation of personnel function from one stage to another in a chronological order:
The Commodity Concept
Before the industrial revolution GUILD SYSTEM was in operation, which was the Beginning Of Personnel Management. Guild was a closely knit group of workers, concerned with the selecting, training, rewarding and maintaining workers. Industrial revolution gave rise to the factory system. As a result, the place of work shifted from residence to factory and the management became spate from ownership. The close relationships between employees and owners were broken. Labour began to be considered as a commodity to be bought and sold. Wages were based on demand and supply. Government did very little to protect the workers.
The Factor of Production Concept
Under the factor of production concept, employees were considered a factor of production just like land, materials and machines. F.W. Taylor in his Scientific Management stressed proper selection and training of employees so as to maximize productivity. The employees were considered as mere operators of machines. However, this concept was an improvement over the commodity concept in so far as employees gained better working conditions and better earnings.
The Paternalistic Approach
The paternalistic approach was based on the belief that management must assume a fatherly and protective attitude towards employees. Paternalism does not mean merely providing but it means satisfying various needs of the employees as parents meet the requirements of the children. During this period, the employees organized themselves on the basis of their common interests and formed trade unions to improve their lot.
The growing strength of trade unions gave an impetus to collective bargaining. The government also recognized that workers began to provide welfare schemes to workers e.g. health facilities, pension plans, Group Insurance Schemes, housing facilities, recreation facilities etc. in this stage, employers and employees both began to realize that they cannot survive and prosper without each other.
The Humanitarian Concept
Under the paternalistic concept, the employer was providing welfare facilities to the employees as a favor. The humanitarian concept is based on the belief that employees had certain inalienable rights as human beings and it was the duty of the employers to protect these rights. To improve productivity, physical, social and Psychological Needs Of The Employees must be met.
As Elton Mayo and others stated, money is less a factor in metermining output, than group standards, group incentives and security. The organization is a social system that has both economic and social dimensions. Hawthrone experiments generated considerable interest in human problems of the work place. This approach is therefore, known as Human Relations Concept.
The Behavioral Human Resource Concept
The human resource concept was based on the belief that employees the most valuable assets of the organization. There should be a conscious effort to realize organizational goals by satisfying Needs And Aspirations Of The Employees. Several studies were conducted to analyze and understand human behavior in the organizations. These studies led to the application of behavioral sciences to the problems of individuals and group behavior at work.
Efforts were made to integrate employees with the organization so that organizational goals and employees aspirations could be achieved simultaneously. Motivation, group dynamics, organizational conflicts etc became popular concept and focus shifted towards management practices like two-way Communication Management By Objectives, role of informal groups, quality circles etc.
The Emerging Concept
The emerging concept aims at creating a feeling among workers that the organization is their own. Employees should be accepted as partners in the progress of the organization. To this end, management must offer better quality of working life and other opportunities to people to exploit their potential fully. The focus should be on Human Resource Development. Slowly and steadily Human Resource Management is emerging as a special academic discipline and as a profession.
Thus, personnel management started from a stage where employees were considered problems. Procedures and costs reached a stage where employees are looked upon as a resource, an asset and an opportunity.