Human Resource Management is a way of managing, maintaining, training and developing the key resource of any organization, its people.
It helps in the smooth functioning of an organization to work towards its goals. It’s the key factor that enables the employers and the organization to achieve their objectives.
It ensures employee satisfaction and sees that employee contribution is maximized to reach the overall target.
It is a transparent way of workforce management that aims to gain a competitive advantage through strategic planning and deployment of its personnel.
Regardless of the industry or the nature of the business, HRM plays a vital role in the success of the business and its people.
Its functions are designed to recruit employees and work towards training, developing, and maintaining their satisfaction and engagement.
The functions ultimately lead to achieving the organizational goals which makes it a catalyst for a successful business.
Importance of HRM Functions
- HRM serves as a backbone for any organization, the proper functioning of the HRM can make or break your company. With the smooth HRM Functions, your business flow is stable and you have all your employees working toward your common goal.
- As the HRM functions are designed to recruit and maintain your workforce, the functions in place the HRs are enabled for getting the recruitment right.
- HRM is and its functions are universal and are applicable in any organization regardless of the size, scope or the industry of business.
- HRM functions are more action-oriented and help in solving employee related problems with sensible policies rather than record-keeping or written process regulations.
- The Functions strive to optimize and maximize the employees’ full potential. They also encourage training and development programs to strengthen the abilities of the workforce.
- These functions are not isolated tasks as they involves all the employees regardless of their role or status in the organization.
Types of HRM Functions
There are no set HRM functions that can be listed out as in these changing times we see that new functions keep getting added to the list of Functions.
However, all the HRM functions old or new can be classified into three categories:
1. Managerial Functions: – Human Resource Planning
2. Operative Functions: – Job analysis and Design
- Selection and Recruitment
- Training and Development
- Wage and Salary Administration
- Performance Appraisal
- Employee Welfare
- Employee Relations
- Employee Research
- Employee Record
3. Advisory Functions: – Advising Top Management
- Advising Department Heads
Knowing and understanding these HRM Functions is essential as the operations and flow of your company runs on them.
Here are some examples of Managerial Functions
1. Human Resource Planning: it is a function that determines the need for the number of employees and the types of employees for achieving organizational goals.
Research becomes an important part of this function as the data is collected and analyzed for current and future HR needs.
This function also helps in forecasting the changing values, attitude, and behavior of the employees and how that would impact the organization and the business.
2. Organizing: In an organization, tasks are allocated among members, relationships are identified and established, and activities are directed towards collectively contributing to the achievement of the organizational goal.
3. Directing: Making the employees contribute their maximum efforts and activating them at different levels is only possible through proper direction and motivation.
when you employees are motivated, you can tap into the employees’ full potential with proper command.
4. Controlling: After planning, organizing and directing, the actual performance of the employees is checked and compared with the original plans.
If the performance of the employees is deviated, it requires some measures of control to be taken so that the employee performance is on track with their goals.
Examples of Operative Functions
- Selection and Recruitment: It is a function that brings together a pool of prospective candidates to the organization. The management can select the right candidate for the job from this talent pool.
- Job Analysis: The process of outlining the nature of a job and specifying the candidate requirements like qualification, skills, and work experience to perform the job is called Job analysis. Job design aims at outlining and organizing tasks, duties, and responsibilities into a single unit of work for the achievement of certain objectives.
- Training and development: This HRM function enables the employees to develop their skills and knowledge in order for them to perform their jobs effectively. Training and development programs help in preparing the existing employees for higher roles and responsibilities. They also help the new and existing employees learn more about their job.
- Wage and Salary Administration: HRM determines what is to be paid for different roles and jobs. HRM helps in deciding the compensation of the employees which include wage administration, salary administration, bonuses, incentives, etc.
- Performance Appraisal: This HRM function is very important as the HRs need to ensure that the employees’ performances are consistent. Performance appraisal rewards the employees for their consistent performance and reaching their objectives.
- Employee Welfare: This is the function that looks after the overall wellbeing of the employees by providing various benefits, facilities, and services to the employees by the organization.
- Employee Relations: This refers to the HRM’s interactions with the employees represented by a union. Employees come together to attain more voice for making decisions impacting the wage benefits, working conditions, etc.
- Maintenance: HR is considered to be an asset to the organization and employee turnover is considered to be good for the organization. HRM always tries to keep and maintain their best performing employees within the organization.
- Personnel Research: Personnel Research is done by HRM to understand the employees’ opinions on compensation, work conditions and work culture, etc. The results of this research help in determining the employee promotions, employee satisfaction, employee upskilling and termination of the employees.
- Personnel Record: This function involves recording, maintaining, documenting, and retrieving employee-related data like – application forms, employment history, working hours, compensation history, employee attendance, employee turnover, and other employee related data.
Examples of Advisory Functions
HRM has expertise in managing the Human Resources of the company and hence has the ability to advise on matters related to the employee to the:
1. Advising the top Management: Personnel managers advices the top management on formulating and evaluating the employee programs, policies and procedures.
2. Advising the Department Heads: The personnel manager advises the department heads on matters such as staff planning, job analysis, job design, recruitment, selection, placement, training, performance appraisal, etc.
Strategic Functions of HRM
To briefly explain the strategic functions of HRM, we first need to understand Strategic HR in detail
You can refer to our whitepaper for a better understanding of Strategic HR
Strategic HRM functions include:
1. Benchmarking the current Standing of your Human Resources: understanding the current stance of your employees is very important as it determines how to set your future goals and helps you understand the timelines for achieving them.
2. Ensuring the business outcomes are aligned with the organizational goals: Everyone in the organization is working towards the organizational goals, but ensuring that the business outcomes are aligned with these goals helps us keep track of the progress.
While helping us to tweak and adjust the things that put us on the right track to achieve these goals effectively.
3. Measuring HR contributions: As the nature of HRM is more action oriented and involves more activity, putting them in numbers is very difficult. Strategic HRM functions help in conveying the true extent of the HR contributions to the leadership.
HRM plays a major role in the smooth functioning of the organization.
The process starts with the formulation of the right policies for the job requirements and ends with ensuring the successful business growth of the organization.
Hence, HRM acts as a catalyst that binds all the aspects of the organization together to ensure smooth progress.
1. What is Human Resource Management (HRM)?
Human Resource Management (HRM) is the strategic practice of overseeing and administering an organization’s workforce. It involves tasks such as recruitment, training, employee relations, and performance management. HRM aims to optimize employee productivity, well-being, and align personnel with the organization’s goals and policies.
2. What are the key functions of HRM?
The key functions of HRM encompass recruitment and selection, training and development, performance management, employee relations, compensation and benefits administration, and HR planning. HRM is responsible for attracting, retaining, and developing a skilled workforce while ensuring compliance with labor laws and fostering a positive work environment.
3. Why is HRM important for organizations?
HRM is crucial for organizations as it ensures the effective management of human capital, which is their most valuable asset. It facilitates talent acquisition, development, and retention, leading to improved productivity, employee satisfaction, and organizational success. HRM also ensures compliance with employment laws and helps align the workforce with the company’s strategic objectives.
4. What is the role of HR in recruitment and selection?
HR plays a central role in recruitment and selection by identifying staffing needs, creating job descriptions, advertising vacancies, screening resumes, conducting interviews, and assessing candidates. They ensure a fair and transparent process, aiming to find the best-fit candidates who align with the organization’s culture and requirements while complying with relevant laws and regulations.
5. How does HRM impact employee development?
HRM impacts employee development by designing training and development programs, assessing skill gaps, and providing opportunities for growth. It fosters a culture of continuous learning, enhancing employees’ skills, knowledge, and career prospects. This results in a more capable and motivated workforce, ultimately benefiting both the employees and the organization.
6. What are compensation and benefits in HRM?
Compensation and benefits in HRM refer to the financial and non-financial rewards offered to employees in exchange for their work. Compensation includes wages, salaries, and bonuses, while benefits encompass health insurance, retirement plans, paid time off, and other perks. These elements play a critical role in attracting, retaining, and motivating employees.