Key functions of the human resource department differ due to organizational characteristics. Human Resource Department deals with Human Resource Management. So, firstly need to understand the in-depth definition of Human Resource Management (HRM). According to Storey(1995), “HRM is a distinctive approach to employment management which seeks to achieve competitive advantage through the strategic deployment of a highly committed and capable workforce, using an integrated array of cultural, structural and personnel techniques”.
12 Key Functions of Human Resource Department:
The 12 key functions of the Human Resource Department are explained as below:
- Human resource planning
- Recruitment and selection
- Performance management
- Learning and development
- Career planning
- Function evaluation
- Industrial relations
- Employee participation and communication
- Health and safety
- Personal wellbeing
- Administrative responsibilities
1. Human Resource Planning
Human resource planning is the most important key function of the Human Resource Department. Human resource planning is sometimes known as workforce planning which is a strategic decision-making process and predicts the future planning of a company. HRD can align with the company’s goal through proper human resource planning by accurately evaluating and analyzing the future needs of the company. Human resource planning can help HRD to focus on overall recruitment, selection, performance management, learning and development, and other HR functions to be successful in the future.
2. Recruitment and Selection
Recruitment and Selection is one of the key functions of the Human Resource Department that attract people to apply for the position and selection of competent people for doing work for the organization. Some organization presently uses recruitment tools for faster and efficient recruitment. On the other hand, some organizations depend on third-party recruiters which is a costly process. The HR department must follow the steps of the selection process for getting advantages of recruitment methods.
3. Performance Management
Performance management is one of the key functions of the Human Resource Department and KPIs for the HR Manager. A performance management system helps organizations to engage employees for ensuring their productivity. The performance management system is effective to identify the gaps in performance so that those can be filled with training and development processes. It also helps organizations to identify the quality requirements of future employees in the organization. Though there are different performance management systems, organizations can select best on their choice and ultimate needs.
4. Learning and Development
Enabling employees to develop the skills they need for the future is an essential responsibility for HR. This is also related to the first HR function in which HR bridges the gap between the present workforce and the workforce needed in the near future. Every organization needs to set a budget for learning and development which is then distributed for its employee’s development.
5. Career Planning
The career planning function of HR is also referred to as career pathing because of the combination function of career guidance and development for employees. This key function of the Human Resource Department shows employees, how their personal ambition can be aligned with the future needs of the company and helps employees to engage and retain them. The organization also gets the benefit of better succession planning and higher productivity.
6. Function Evaluation
Function evaluation is the difficult and more technical key function of the Human Resource Department that involves comparing various functions in terms of qualification, quality, and availability of workers, job location, working times, job responsibility, the economic situation, and how much value this job adds to the organization. The idea behind function evaluation is that similar jobs should be rewarded similarly.
There are different ways of internally ranking functions:
- Ranking method: A method in which subject matter experts rank functions in terms of how much they contribute to the organization as a whole. Functions are paired and raters have to decide which one is more valuable. This is done with all functions and based on the outcome, a ranking is established.
- Classification method: In classification methods, jobs can also be classified into different categories. In this case, jobs are categorized and then ranked within these categories to come up with a ranking. Categorizations can include education, experience, the degree of specialized skills needed to do the job, the degree to which these skills are in-demand, and so on.
- Points method: jobs are categorized according to the factors the organization believes contribute most to its success. Points are then awarded to each category for every job. These categories can include key competencies, like problem-solving, technical knowledge, communication and influencing skills, innovative capability, business acumen, and so on. These competencies will differ per organization
- Personal method: in this method, the job itself is not evaluated but the person doing the job is. Here, employees are rewarded based on their personal skills and competencies.
Rewarding employees for their work is a key function of the Human Resource Department that is impossible to mistake. Rewards basically include salary but also growth and career opportunities, status, recognition, good organizational culture, and a satisfying work-life balance.
The total rewards framework shows us that rewards are more than just money. They can also be relational and psychological outcomes in some cases. For example, fantastic colleagues and meaningful works are also rewarding to the employees. The monetary reward of any job consists of financial rewards and other benefits that are considered secondary benefits.
Rewards are thus much more than just financial. Here is a non-exhaustive overview of total rewards:
- Base salary
- Social environment
- Job security
- Alternating work
- Growth opportunities
- Formal and informal development opportunities
The above 7 key functions of the Human Resource Department fall within the scope of talent management where they aim to attract, develop, motivate and retain high-performing employees.
8. Industrial Relations
Another key function of the Human Resource Department is maintaining and cultivating relationships with labor unions and other collectives and their members. Maintaining a good relationship with unions will help the HR department to spot and resolve potential conflicts quickly and will also be beneficial in more difficult economic times when layoffs or other actions are required.
9. Employee Participation and Communication
According to Dave Ulrich, one of the key functions of the Human Resource Department is to be a credible activist for the employees. Employees need to be informed and heard on different topics that are relevant to them. Communication relates to spreading information relevant to employees.
10. Health and Safety
HR plays an important role in creating and implementing occupational health and safety regulations. Making these regulations part of the company culture is one of the main functions of HR. A famous example is oil company Shell where it is forbidden to walk the stairs without holding the railing – also in the company’s HQ. This is part of Shell’s ‘Goal Zero’, which stands for zero accidents. Although holding the railing is much more important on an oil platform, safety is such a big part of the company culture that safety roles are applied everywhere.
11. Personal Wellbeing
The HR department has to play a vital function in assisting and taking care of employees when they run into personal problems. Personal well-being is about supporting employees when things don’t go as planned and employee’s productivity decreased due to personal problems.
12. Administrative Responsibilities
Administrative responsibility is treated as the key function of the Human Resource Department which includes personnel procedures and Human Resource Information Systems (HRIS). Personnel procedures involve the handling of promotions, relocation, discipline, performance improvement, illness, regulations, cultural and racial diversity, unwanted intimacies, bullying, and so on. For each of these situations, policies and procedures need to be developed and followed to successfully comply with the requests, or overcome these challenges.
Human Resource Information Systems (HRIS) store employee’s data. These systems need to be purchased, implemented and managed so the data can be used for better decision-making.
Advantages of key functions of Human Resource Department
Above 12 absolute key functions of Human Resource Department are the major functions that every HR department should perform for the best output of department’s activity. Each function has been critically analyzed for getting the best output as:
- Best talent management
- Increased employee satisfaction
- More employee productivity
- Safe and Healthy work environment
- Creation of future talent etc.