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Human Resource Management

Notes development of the 'factory' system. Factories greatly expanded production and created a new
class of workers and managers. It brought about division of work. It necessitated supervising
large number of workers. With the advent of factory system, personnel practices became
autocratic, based on Commodity concept of Labour. Labour was purchased at terms designed to
maximize the employer's profit. Consequently, there was a total neglect of "Human Factor"; the
focus was upon materials, market and production.

Stage III: Scientific Management, Welfare Work and Industrial Psychology
(1900-1935 AD)

Scientific Management and Welfare Work represent two separate and concurrent movements
that began in the 19th century and along with contribution from Industrial Psychology, merged
around the time of World War I to form the field of Human Resource Management.
Scientific management represents an effort to deal with labour and management inefficiencies
through re-organisation of production methods and rationalization of work.

Welfare work is defined as anything done for comfort and improvement, intellectual or social
for the employees over and above wages paid, which is not the necessity of industry, not
required by law. It represents efforts to deal with labour problems by improving workers'
conditions.
Industrial psychology represented the application of psychological principles towards increasing
the efficiency of industrial workers.
Fredrick William Taylor's Scientific Management can be summed up as:
1. Science, not the rule of thumb

2. Harmony, not discord
3. Co-operation, not individualism
4. Maximum output, in place of restricted output.

Contribution of Scientific Management to Human Resource Management

1. Taylor's proposal for functional management called attention to the need for separate
Human Resource functions in organization.
2. Taylor demonstrated the feasibility of job analysis as a basis for employee selection,
training, job evaluation and compensation.

3. Taylor demonstrated that work and jobs can be systematically studied, analysed, redesigned
or improved upon.
4. He stressed the importance of proper selection procedure and training methods.

5. Taylor advanced the idea of differential pay on the basis of productivity.
6. He highlighted the need of workers to be won over and led by management.

Industrial Psychology

From scientific management, industrial psychology evolved. The objective of industrial
psychology was to increase human efficiency by focusing on the maximum well-being
of the workers and decreasing the physiological and psychological costs of work. Hugo,
Munsterberg and William Gilbreth, contemporary psychologist sought to integrate psychology

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