IGNOU MTTM 2 SOLVED ASSIGNMENT 2021-22
MTTM-2/ MTM 2:
HUMAN RESOURCE PLANNING AND DEVELOPMENT INTOURISM
(Tutor Marked Assignment) Course Code: MTTM 2/MTM 2 Total Marks: 100
Assignment Code: MTTM 2/MTM 2/TMA/2022
1. Define Human Resource Accounting. Why is it important in the tourism industry?
Human resource accounting is the measurement of cost and value of the people for the organisation. Human resource accounting can be defined as a system of accounting which consider human resources as an asset and all the financial expenses on human resources such as wages, salary, training
etc. are recorded in the books of account. The value of human resources is also recorded in the books of account just like other physical possessions. Assessment, budgeting and reporting the cost of Human Resource help the organisation in accurately documenting its assets and thus is very monetary part of every business association. A financial report of any organisation completely depends on the cost of manpower working in that organisation.
Objectives of Human Resource Accounting
Human resource accounting objectives are as follows :
- It helps the organisation to plan an estimated budget for human resource expenses well in advance which include acquisition cost, training cost, cost for expansion of the human assets, salaries and wages
- Human resource accounting is one of the best way to measure the expenses done by an organisation on the human resource and the exact value of these All the decisions regarding to manpower working in a particular organisation are based on the HRA.
- Once the management has entire mathematical information about the human assets of the organisation, they start considering it as an important part of all their decisions. This further improves the managerial ideology as the organisationbecomes clear about the economical effects of the human resources.
- The HRA system help the management of any organisation to judge the employees on the basis of their performance and their standards and provide them with incentives
- In order to estimate the value of human resources an organisation has to follow certain principles and procedure as per the standards set by the Human Resource
- In case there are any upcoming changes in the value of the human assets working in the Human Resource Accounting gives an indication to the authority in advance so that appropriate step can be taken to preserve most valuable human assets of the organisation.
- It helps the administration to scrutinize whether the available human resources are utilized in the best possible way or not,
i.e. there should be the optimal utilization of the workforce. There should be no exploitation of labour in the organisation.
Process of Human Resource Accounting
There is a particular procedure that has to be followed by the management to execute human resource accounting. The procedure is as follows :
Step 1 : HRA Objectives –
Every organisation has to accomplish a certain set of goals. These goals and the organisational requirements are the foundation for setting the objectives of the human resource accounting system.
Step 2 : Developing HRA Measurements –
There are two methods by which human resource accounting measurement can be made. They are explained below :
- Monetary or Non-monetary methods can also be used as standard for measuring the cost or value or both of human
- Either the management can go for one particular measurement method or a number of methods for the
Before implementing any of these methods the validity and consistency of this method must be checked.
Step 3 : Developing HR Accounting Database –
The human resource accounting system is based on certain factors such as time management sheet, the cost of each employee working in the organisation, various psychological factors etc. These factors from the database of HRA system.
Step 4 : Pilot Testing the System –
Pilot testing means pre-checking the working of the system before finalising it as a part of the organisation. Management co-ordination and co-operation throughout the process of pilot testing is essential for its success.
Step 5 : Implementing the Human Resource Accounting System –
In this process, organisation introduced the the entire workforce and staff with a new accounting system. The importance and different methods of HRA are specified to the employees so that they become familiar with the new concept and accept it wholeheartedly.
Importance / Advantages of Human Resource Accounting
With the passage of time, Human Resource Accounting has occupied a significant position in almost all the organisation. Its importance has been discussed below :
1. Sign of Good Health of the Organisation –
HRA serves as an indicator of the well-being of any organisation. The amount of investment made on the human resources of any organisation help in measuring the amount of profit that may be earned in future.
2. Help in Determining the Need of Recruitment –
HRA reports about the changes of getting returns and how much expenditure should be made on the manpower of the organisation. If the profits are high demand for recruiting new employees increase and if no profits are gained no further recruitment take place. These decision are completely based on the information provided by HRA.
3. Ascertains Negative Effects of the Programmes –
HRA system also helps the management in determining the negative effects of several programmes running in the organisation.
4. Facilitates Scheduling and Implementing HR Policies –
HR policies of an organisation include policies regarding HR functions such as promotion, training, demotion, transfer etc. Proper scheduling and implementation of these policies is very important for the smooth functioning of every organisation. This functions is controlled by the human resource accounting system of an organisation.
5. Helps in Calculating ROI –
HRA is an accounting system which recognises the expenditure made on the human resources of an organisation. Once the investment is calculated an organisation can easily ascertain the exact return on investment (ROI) by calculating the profit made by the organisation. This will help the management to determine how much they should spend on the human resources to achieve maximum Return on Investment.
6. Motivates Employees –
Employees get motivated to improve themselves once they come to know their real value in the eyes of Human Resource Accounting system of the organisation. The amount invested on
them will inspire them to increase the output in proportion to the investment made on them by the organisation.
7. Improves Process of Decision Making –
HRA works as a centre to gain information regarding the actual value of human resources working in the organisation. This information helps the management to take appropriate decisions regarding the organisational issues.
3. Describe the Quantitative and Qualitative Dimensions of Human Resource Planning.
Human resources undoubtedly play the most important part in the functioning of an organization. The term ‘resource’ or ‘human resource’ signifies potentials, abilities, capacities, and skills, which can be developed through continuous interaction in an organizational setting.
The interactions, interrelationships, and activities performed all contribute in some way or other to the development of human potential. Organizational productivity, growth of companies, and economic development are to a large extent contingent upon the effective utilization of human capacities.
Hence, it is essential for an organization to take steps for effective utilization of these resources. In the various stages in the growth of an organization, effective planning of human resources plays a key role. Matching the requirements of the job with the individual is important at all stages, including the recruitment procedures, in this endeavour.
When organizations contemplate diversification or expansion, or when employees have to be promoted, human resource planning plays an important role. Further, the organizational plans, goals, and strategies also require effective human resource planning.
Human Resource Planning – Quantitative and Qualitative Dimensions:
Human resources have a dual role to play in the economic development of a country. On one hand they are the consumers of the products and services produced by the organizations while on the other hand they are one of the factors of production.
Along with capital and other factors of production, human resources can lead to increase in production and economic development. The rate of growth of human resources is determined by two aspects quantitative and qualitative.
Variables Determining the Quantity of Human Resources:
- Population Policy:
Some population policies operate by influencing the factors responsible for growth such as fertility, marriage and mortality. These are known as population influencing policies. Another category of policies known as responsive policies are implemented to adjust to observed population trends with the help of programmes like health, nutrition, education, housing, etc. The aim of population policies is to achieve an optimum population for enhancing the country’s development.
2. Population Structure:
The structure or composition of the population is determined by two factors, sex composition and age composition.
(i) Sex Composition:
Sex ratio is the ratio of males to females in the population. It is the basic measure of the sex composition of the population of any area. Higher the number of females, higher will be the population growth rate in future.
(ii) Age Composition:
It is the distribution of population by age groups. Age composition is the result of past trends in fertility and mortality. The supply of labour depends on age composition as
economically active population falls in range of 15-65 age groups.
Net migration is another factor which causes changes in the population. Age and sex composition determine the natural growth in population, but for calculating the overall changes in population it is important to consider net migration also.
Net migration = total immigrants – total emigrants
A positive net migration will lead to a rise in population growth rate while negative net migration will reduce the growth rate of population. Migration can be both interregional and international.
4. Labour Force Participation:
The population of any country consists of workers and non-workers. The workers are the people, usually in age group of 15-65, who participate in economically productive activities by their mental or physical presence.
- Self-employed persons, and
- Those engaged in family enterprises without
The others in the population are the non-workers such as students, infants, elderly, beggars, retired people, inmates of jail or mental institutions, unemployed, etc. They do not contribute to any productive economic activity. It is the changes in the working population which affect the growth of human resources. The number of people who are unemployed but available for work also impacts the availability of labour.
Qualitative Aspects of Human Resource Planning:
The quantitative dimensions help to ascertain human resources in numbers while the productive power of human resources is assessed by the qualitative dimensions. For example, there may be hundreds of applicants for 20 vacancies, but out of these only a few may meet the quality standards required for the job.
Factors which determine the quality of human resources are:
- Education and Training:
The quantity and quality of education and training received by human resources impacts their knowledge and skills. Education and training are important for the upliftment of both individual and society. It can be of two types, formal and informal.
Formal education is imparted through schools and colleges while informal education and training takes place through on-the-job training methods. Formal education stresses the transfer of theoretical knowledge, while informal education emphasizes on practical application of knowledge.
2. Health and Nutrition:
Health and nutrition along with education are vital for Human Resource Development. Health and nutrition impact the quality of life, productivity of labour and the average life expectancy.
Health status is determined by:
- Purchasing power of
- Public sanitation, climate and availability of medical
- People’s understanding and knowledge of health, hygiene and nutrition.
3. Equality of Opportunity:
Not all segments of people comprising human resources get equal employment opportunities. There is bound to be some discrimination.
The most common forms of discrimination are:
- Social discrimination – Discrimination on basis of gender, religion or social standing.
- Economic discrimination – Discrimination based on financial positions or possession of wealth by the sections of
- Regional discrimination – These are in form of discrimination between rural and urban population or between people belonging to different regions/
Discrimination affects the quality and productivity of the human resources belonging to different sections of the population. The privileged classes get access to best education, nutrition and health facilities while underprivileged are deprived of their right share in the development process. For the overall, well rounded development of the country’s human resources, effective policies need to be implemented to deal with the problem of discrimination.
4. Define conflict. What are available models of conflict management?
A conflict is a struggle and a clash of interest, opinion, or even principles. Conflict will always be found in society; as the basis of conflict may vary to be personal, racial, class, caste, political and international. Conflict may also be emotional, intellectual, and theoretical, in which case academic recognition may, or may not be, a significant motive. Intellectual conflict is a subclass of cultural conflict, a conflict that tends to grow over time due to different cultural values and beliefs.
Conflict in a group often follows a specific course. Routine group interaction is first disrupted by an initial conflict within the group, often caused by internal differences of opinion, disagreements between its members, or scarcity of resources available to the group. At this point, the group is no longer united, and may split into coalitions. This period of conflict escalation in some cases gives way to a conflict resolution stage, after which the group can eventually return to routine group interaction or split.
Citing a review of definitions of organizational conflicts in 1990 by Robert A. Baron, Afzalur notes that all definitions of conflict include known opposing interests and the process of trying to stop the opposing view or views. Building on that, the proposed definition of conflict by Afzalur is “an interactive process manifested in incompatibility, disagreement or dissonance within or between social entities.” Afzalur also notes that a conflict may be limited to one individual, who is conflicted within himself (the intrapersonal conflict). Afzalur lists some manifestations of conflict behavior, starting with disagreement followed by verbal abuse and interference.
Conflict management is the process of limiting the negative aspects of conflict while increasing the positive aspects of conflict. The aim of conflict management is to enhance learning and group outcomes, including effectiveness or performance in an organizational setting. Properly managed conflict can improve group outcomes.
Conflict resolution involves the reduction, elimination, or termination of all forms and types of conflict.
Five styles for conflict management, as identified by Thomas and Kilmann, are: competing, compromising, collaborating, avoiding, and accommodating. Businesses can benefit from appropriate types and levels of conflict. That is the aim of conflict management, and not the aim of conflict rejection. Conflict management does not imply conflict resolution. Conflict management minimizes the negative outcomes of conflict and promotes the positive outcomes of conflict with the goal of improving learning in an organization. Properly managed conflict increases organizational learning by increasing the number of questions asked and encourages people to challenge the status quo. Organizational conflict at the interpersonal level includes disputes between peers as well as supervisor-subordinate conflict. Party-directed mediation (PDM) is a mediation approach particularly suited for disputes between co-workers, colleagues or peers, especially deep-seated interpersonal conflict, multicultural or multiethnic disputes. The mediator listens to each party separately in a pre-caucus or pre-mediation before ever bringing them into a joint session. Part of the pre-caucus also includes coaching and role plays. The idea is that the parties learn how to converse directly with their adversary in the joint session. Some unique challenges arise when organizational disputes involve supervisors and subordinates. The Negotiated Performance Appraisal (NPA) is a tool for improving communication between supervisors and subordinates and is particularly useful as an alternate mediation model because it preserves the hierarchical power of supervisors while encouraging dialogue and dealing with differences in opinion
- Explain the basis of measuring revenue and expenses with suitable
One of the most significant accounting concepts is “Concept of Income”. Similarly, measurement of a business income is also an important function of an accountant. In General term, payment received in lieu of services or goods are called income, for example, salary received by any employee is his income. There may be different type of incomes like Gross income, Net income, National Income, and Personal income, but we are here more concerned for a business income. Surplus revenue over expenses incurred is called as “Business Income.”
Objectives of Net Income
Following are the important objectives of a net income −
- Historicalincome figure is the base for future
- Ascertainmentof a net income is necessary to give portion of profit to
- To evaluate the activities, which give higher return on scarce resources are It helps to increase the wealth of a firm.
- Ascertainmentof a net income is helpful for paying dividends to the shareholders of any
- Returnof income on capital employed, gives an idea of overall efficiency of a
Measurement of Revenue
Measurement of the revenue is based on an accrual concept. Accounting period, in which revenue earned, is the period of revenue accrues. Therefore, a receipt of cash and revenue earned are the two different things. We can say that revenue is earned only when it is actually realized and not necessarily, when it is received.
Measurement of Expenses
- Incase of delivery of goods to its customers is a direct identification with the
- Rentand office salaries are an indirect association with the
There are four types of events (given below) that need proper consideration about as an expense of a given period and expenditure and cash payment made in connection with those items −
- Expenditure,which are expenses of the current
- Some expenditure, which are made prior to this period and has become expense of the current year.
- Expenditure, which is made this year, becomes expense in the next accounting For example, purchase of fixed assets and depreciation in next up-coming years.
- Expense of this year, which will be paid in next accounting For example, outstanding expenses.
- Explain with the help of suitable examples the significance and role of HRD in Tourism and Hospitality
Human resource managers direct the administrative functions of the business. While it takes many others to implement these functions, HR looks to attract, motivate and place employees in the best-fitting positions. When employees are happy and motivated, they provide the desired level of customer service required for the business’s success.
HR in the hospitality industry plays an essential role: HR keeps employees happy so that they maintain the excellent reputation of the business and keeps customers happy by ensuring employees behave appropriately and according to company policy.
Unique HR Challenges in Hospitality
Positions in the hospitality industry are usually hourly rather than salaried, making employee retention challenging to maintain. Employees work long hours, including nights, weekends and holidays. Additionally, customer-facing positions come with their own set of unique challenges. Having to meet the high demands from the business and customers – and with such a strong focus on customer service – these positions are physically and mentally exhausting. When businesses are understaffed, employees lose possible flexibility in scheduling, leading to frustration and burnout.
Recruiting Hospitality Industry Employees
Attracting skilled employees begins with the job posting. Detailed job postings that lay out the desired
skills, experience and benefits of the position ensure that applying candidates understand the job and know whether their qualifications meet the requirements.
When faced with shortages, HR can hire seasonal employees under the H-2B visa program as detailed at the U.S. Citizenship and Immigration Services website. Alternatively, human resource managers in the
hospitality industry may turn to staffing agencies for help with their shortages. Some of these employees can become permanent later on if they meet expectations and a need arises.
Employee Morale and Retention
In the hospitality industry, it’s essential that employees are professional and happy because their attitude reflects strongly on the business itself. This task usually falls to human resources.
Offering good benefits and proposing incentives is an excellent place to start. Discounts on the company’s own services and employee recognition programs effectively increase employee happiness in the workplace. However, employees want to know that there are growth opportunities within the business to stay. Additionally, they want promises of retirement plans or health insurance.
In-house professional development programs and hiring from within are ways for new hires to see a future in the industry. Preparing employees for future leadership opportunities within the company shows employees that their time with the company can be a viable career option.
Uniting Management and Employees
HR in the hotel industry often serves as the bridge between management and employees. HR should look to streamline communications to decrease the potential of misunderstandings and frustrations between the two.
Best Practice Institute suggests that eliminating information silos in the organization’s levels allows for experience and knowledge to be readily available, increasing performance and employee satisfaction. Pay is critical for employee satisfaction and retention. HR should ensure that pay is based on regional market rates, and help employers handle tips under the federal tax code. Issuing cash bonuses for raising productivity is another way of improving employee satisfaction within the hospitality industry.