What is human resource management?
Human resource management (HRM), also known as human resources or HR, is a company’s process involving hiring, recruiting, training, compensating, and managing employees.
Human resource management once only served an administrative function, such as filling out paperwork and reading résumés, but now it’s enmeshed in furthering the company’s goals through training programs, policy creation, and strategic hiring.
Many companies use human resource management systems to provide a unified platform for HR management and reporting. These software systems feature a customizable modular design for each organization’s unique needs.
Human resource management functions
Human resource management takes on different responsibilities depending on the organization’s size and industry. Some of the most common tasks that HRM fulfills include:
- Staffing. Not only does HRM create job postings outlining roles and responsibilities, but they also recruit and interview candidates. Once they select the candidate they feel best fits the position, they negotiate base pay and benefits.
- Administering compensation. Human resources management creates compensation packages based on a complex array of factors, including the employee’s education levels, previous experience, and skills. They also track and consider industry-wide averages for similar positions to ensure competitive pay.
- Leading performance evaluations. At some companies, HRM also evaluates employees’ job performance and productivity and suggests additional training if needed.
- Delivering training programs. Human resources management guides employee development by designing or choosing training programs to further their skills. HRM may also contract motivational speakers or team-building specialists to increase productivity and engagement.
- Ensuring a safe workplace. Human resources professionals keep up on the latest regulations, like workplace discrimination laws. HR also has expertise regarding wages and hours as outlined in the Fair Labor Standards Act (FLSA) and employee safety from Occupational Safety and Health Administration (OSHA) standards, ensuring company compliance.
Benefits of human resource management
An effective human resources management process improves the organization's overall culture, creating an enjoyable work environment and increasing retention. More specifically, healthy HRM provides:
- Increased employee engagement. With the right training and development opportunities, employees can participate more fully and productively in their roles. HRM can also offer employees coaching and mentoring to help them realize their full potential.
- Happier environment. Human resource management values the well-being of each employee and provides opportunities for them to engage in fitness challenges and other accessible social opportunities that boost morale. Plus, they offer guidance about mental health and wellness programs.
- Conflict reduction. HRM mitigates disputes between teams and individuals or between individuals and the company itself. By investigating and resolving conflicts, human resource management decreases time lost, preserves employees’ productivity, and reduces turnover.
Human resource management best practices
Human resources management helps a company acquire, nurture, and retain top talent. To do this effectively, HRM should follow these best practices.
- Build collaborative teams. One of HRM’s goals is to create well-balanced teams that work together to further company objectives. HR teams should use skill and personality assessments to evaluate individual strengths. They can also provide teams with the necessary communication and project management tools to facilitate an efficient and productive working environment.
- Conduct video interviews. Conducting the first round of interviews over the internet on a video call saves the human resources department time and money, and it’s often more convenient and comfortable for the interviewee. HRM can hold these interviews live or ask the candidate to submit a video that answers specific questions.
- Provide open communication. Fostering transparency builds a sense of trust between the employees and the company. If employees know the company's strategies and financials, they’ll feel like valued team members.
- Curate a tech stack. Human resources management is a vast field with wide-ranging roles and functions. Selecting the right software saves time and energy. For example, many companies use an applicant tracking system (ATS) to organize job applicant data, onboarding software for new hires and training management systems to design and manage employee learning.
- Gather feedback. It’s crucial to get input from employees to develop strong working relationships. For example, current employees can provide insights via surveys about which benefits they value or guest speakers they would like to see. When employees leave the company, HRM should also conduct face-to-face exit interviews to learn ways to boost retention in the future.
Learn five ways your human resources management team can reduce turnover in your organization.
Kelly Fiorini
Kelly Fiorini is a freelance writer for G2. After ten years as a teacher, Kelly now creates content for mostly B2B SaaS clients. In her free time, she’s usually reading, spilling coffee, walking her dogs, and trying to keep her plants alive. Kelly received her Bachelor of Arts in English from the University of Notre Dame and her Master of Arts in Teaching from the University of Louisville.
