The Meaning of Human Resource Management (HRM)

Human resource management (HRM) is the practice of recruiting, hiring, deploying and managing an organization's employees. HRM is often referred to simply as human resources (HR). A company or organization's HR department is usually responsible for creating, putting into effect and overseeing policies governing workers and the relationship of the organization with its employees. The term human resources was first used in the early 1900s, and then more widely in the 1960s, to describe the people who work for the organization, in aggregate.

HRM is employee management with an emphasis on those employees as assets of the business. In this context, employees are sometimes referred to as human capital. As with other business assets, the goal is to make effective use of employees, reducing risk and maximizing return on investment (ROI).

The modern HR technology term human capital management (HCM) has been used more frequently compared to the term HRM. The term HCM has had widespread adoption by large and midsize companies and other organizations of software to manage many HR functions.

The importance of human resource management

The role of HRM practices are to manage the people within a workplace to achieve the organization's mission and reinforce the culture. When done effectively, HR managers can help recruit new professionals who have skills necessary to further the company's goals as well as aid with the training and development of current employees to meet objectives.

A company is only as good as its employees, making HRM a crucial part of maintaining or improving the health of the business. Additionally, HR managers can monitor the state of the job market to help the organization stay competitive. This could include making sure compensation and benefits are fair, events are planned to keep employees from burning out and job roles are adapted based on the market.

How does HRM work?

Human resources management works through dedicated HR professionals, who are responsible for the day-to-day execution of HR-related functions. Typically, human resources will comprise an entire department within each organization.

HR departments across different organizations can vary in size, structure and nature of their individual positions. For smaller organizations, it is not uncommon to have a handful of HR generalists, who each perform a broad array of HR functions. Larger organizations may have more specialized roles, with individual employees dedicated to functions such as recruiting, immigration and visa handling, talent management, benefits, compensation and more. Though these HR positions are differentiated and specialized, job functions may still overlap with each other.

Amazon is an example of a large company with multiple types of specialized HR positions. Amazon's career website lists 15 different HR job titles:

• HR assistant
• HR business partner
• HR manager
• Recruiter
• Recruiting coordinator
• Sourcer
• Recruiting manager
• Immigration specialist
• LoA and accommodation specialist
• Compensation specialist/manager
• Benefits specialist/manager
• Talent management specialist/manager
• Learning and development specialist/manager
• HR technology/process project program manager
• HR analytics specialist/manager

Objectives of human resource management

The objectives of HRM can be broken down into four broad categories:

1. Societal objectives: Measures put into place that responds to the ethical and social needs or challenges of the company and its employees. This includes legal issues such as equal opportunity and equal pay for equal work.
2. Organizational objectives: Actions taken that help to ensure the efficiency of the organization. This includes providing training, hiring the right number of employees for a given task or maintaining high employee retention rates.
3. Functional objectives: Guidelines used to keep HR functioning properly within the organization as a whole. This includes making sure that all of HR's resources are being allocated to their full potential.
4. Personal objectives: Resources used to support the personal goals of each employee. This includes offering the opportunity for education or career development as well as maintaining employee satisfaction.

The four objectives of HRM

Within the unit of each organization, the objectives of HRM are to:

1. Help the organization achieve its goals by providing and maintaining productive employees.
2. Efficiently make use of the skills and abilities of each employee.
3. Make sure employees have or receive the proper training.
4. Build and maintain a positive employee experience with high satisfaction and quality of life, so that employees can contribute their best efforts to their work.
5. Effectively communicate relevant company policies, procedures, rules and regulations to employees.
6. Maintaining ethical, legal and socially responsible policies and behaviors in the workplace.
7. Effectively manage change to external factors that may affect employees within the organization.

Skills and responsibilities of an HR manager

HRM can be broken down into subsections, typically by pre-employment and employment phases, with an HR manager assigned to each. Different areas of HRM oversight can include the following:

• Employee recruitment, onboarding and retention
• Talent management and workforce management
• Job role assignment and career development
• Compensation and benefits
• Labor lawcompliance
• Performance management
• Training and development
• Succession planning
• Employee engagement and recognition
• Team building

Skills that can add value to HR managers include:

• Employee relations
• Job candidate relations
• Sourcing and recruiting
• Interpersonal conflict management
• New employee onboarding
• HR software and information system experience
• Performance management
• Customer service
• Project management