7 Important Human Resource Management Functions For Successful Businesses

What Are The Human Resource Management Functions?
Benefits of Human Resource Management Functions.
Which Human Resource Management Function is The Most Important?

Being a human resource manager for a large organization is not an easy job, especially if you were tasked with building an entire HR department supporting all human resource management functions from scratch. Back in 2003 and immediately after graduating from college, I was hired at one of the largest hospitals in Jordan as an entry-level manager. At the time, the hospital had 400 beds and 1,100 employees across all departments, including doctors, nurses, other medical practitioners, managerial teams, housekeepers, nutritionists & cooks, and other staff members.

In 2005, I was promoted to manager of the HR department. The catch? I was the sole member of that department, and my job was to construct it from the ground up into a functional HR department. The goal was to not only support the entire hospital and all of its employees but to also enhance the quality of services the hospital provided.

On my first day as a human resource manager, I initiated a situation analysis to identify both the hospital’s capabilities and challenges that would play a role in attempting to develop the HR department. This analysis helped me understand how to build the human resource system and what human resource management functions to focus on.

As a human resource professional, it is important to understand that working in the HR department means that you have to deal with every department and every employee in the institution. Applying human resource management standards does not mean that this application only affects the HR staff. In fact, it touches all employees in the organization, which in turn affects the quality of medical services provided to patients.

In this article, I will share with you my experience related to the most important human resource management functions that will help any organization to successfully deliver its products and services to the target market. Before diving into the functions, please see the following short video to introduce the HR functions.

Introduction to Human Resource Management Functions By Hashem Abusenenh

What are the Human Resource Management Functions?

Human resource management is an essential aspect of any organization, as it involves managing and developing the people who work within it. The HR department is responsible for a wide range of functions, from recruitment and training to performance management and employee relations. Understanding these functions is important for anyone looking to start working in HR or managing a team effectively, as they are the base for ensuring that staff members are working in a supporting, motivating, and engaging environment.

Function #1: Planning

“If you don’t know where you’re going, any road will get you there.” This phrase pretty much summarizes the conversation between Alice and the Cheshire cat mentioned in “Alice in Wonderland” by Lewis Carroll. This conversation took place when Alice was lost and trying to find a way out. The moral of this quote is how can people choose a road to somewhere when they do not know where they are going? How do they get “there” when they do not know or even care where “there” is?

To be able to lead a human resource department, it is important to plan properly for this department so that we specify its future vision. The planning function involves forecasting the organization’s future staffing needs and ensuring that these needs are met by developing proper strategies.

To conduct proper human resource planning, HR professionals should analyze the current and future workforce, identify skills gaps, and then develop recruitment, training, and retention strategies to bridge these gaps.

Function #2: Recruitment and selection

Based on my experience, I can say that recruiting employees is the most important human resource function that should receive the most investment. Hiring suitable employees leads to providing the best services to customers, resulting in increased customer loyalty and profit. As a human resource manager, I have often faced resistance from top management to recruitment plans as they try to minimize costs. My response to this is a quote that I like: “If you think it is expensive to hire a professional, wait until you hire an amateur.”

Components of the recruitment process include advertising job openings, screening resumes and applications, interviewing candidates, and selecting qualified candidates for the job. HR professionals should ensure that this process is fair and ensures that the organization has a skilled and diversified workforce while complying with any relevant laws and regulations.

“If you think it is expensive to hire a professional, wait until you hire an amateur.”
Red Adair

Function #3: Training

Training is a vital function of human resource management. It provides employees with the required skills and knowledge to effectively perform their jobs. As human resource professionals, we are responsible for designing and implementing training plans and programs that address the company’s needs and help in supporting employee growth. Employees’ growth and development are essential for their retention, satisfaction, and engagement. No matter how expert the employee is or what organizational level they are in, training is essential for everyone. As a human resource manager, I have received positive feedback from employees after providing them with training courses, even if the courses were simple and short.

Function #4: Performance management

Performance management is an important managerial and human resource tool that involves setting clear objectives for work. A well-prepared performance management system will provide employees with clear objectives for their jobs and organization. When preparing this system, HR professionals should ensure that the system aligns with the organization’s objectives and helps to improve employee productivity and engagement. Employee performance appraisal may be the most famous performance management system. Appraising employees’ performance is the foundation of all plans related to enhancing and growing their skills.

Function #5: Compensation

The main focus of the human resource department is employees. In order to attract and retain talented employees, we should design solid compensation strategies. In human resource management, compensation is all the monetary and non-monetary rewards provided to employees by their organizations in exchange for their work. This includes salary, bonuses, benefits, and non-monetary rewards such as flexible work hours and career development. The compensation system should be flexible and able to be modified. As employees grow, their motivation levels change.

Function #6: Employee relations

When people are financially invested, they want a return, but when they are emotionally invested, they want to contribute. Employee relations is the field of creating, managing, and maintaining a positive connection between management and the workforce. Employee relations have different benefits to the company, such as reducing turnover, fostering loyalty, reducing costs, and increasing productivity. To do this, HR professionals need to encourage enthusiasm, praise, and reward good performance, and increase communication and leadership visibility.

Function #7: Diversity & inclusion

Human resource professionals are responsible for implementing policies and practices that promote diversity and inclusion. These policies include recruiting and hiring practices that prioritize diversity, training programs that promote cultural competence, and policies that support underrepresented groups. A diverse workforce brings together people with different backgrounds, experiences, and perspectives, leading to more innovation and creativity, better decision-making, improved morale and retention, and a better company reputation and brand image.

Benefits of Human Resource Management Functions.

As you know by now, Human Resource Management is critical for any organization. Establishing a strong human resource system that involves all required functions helps companies to successfully provide high-quality products and services to customers.

The table below gives a clearer idea about the difference between companies that apply human resource management functions and those that do not.

Criteria for Comparison	Organizations with Human Resource Management Functions	Organizations without Human Resource Management Functions
Employee Recruitment	Attract top talent using advanced recruiting techniques and technologies.	Limited to relying on referrals or job postings without any established recruitment strategy.
Employee Development	Provide training, education, and career development opportunities for employees to enhance their skills and knowledge	Limited opportunities for employee development and growth, resulting ins stagnant career paths.
Employee Retention	Offer competitive compensation and benefits to retain employees. They promote healthy work-life balance.	High employee turnover rates due to poor compensation and benefits.
Organizational Culture	Foster a positive and inclusive culture that values diversity and employee engagement.	Lack of direction and motivation among employees due to the absence of established organizational culture.
Compliance and Risk Management	Comply with legal and regulatory requirements and manage risks associated with staff members’ practices.	Exposure to legal and financial risks due to lack of compliance with employment laws and regulations.

Which Human Resource Management Function is The Most Important?

Human Resource Management functions are all interdependent and crucial for the success of the organization. It is difficult to choose one function as the most important. However, some functions have a more significant impact on an organization’s success than others.

I believe that recruitment and selection and training and development are very important for organizations. These functions lay the foundation for the organization’s success. By attracting, selecting, and hiring the right candidates, an organization can ensure that it has the required knowledge, skills, and expertise to reach its goals.

I consider training and development an important function that needs more attention as they provide employees with the needed knowledge, skills, and tools needed to perform jobs effectively. Each organization defines the most crucial function based on its needs, priorities, and its HR management approach.

From recruitment and selection to training and development, compensation and benefits, performance management, and compliance and risk management, human resource management functions are the cornerstone of effective people and talent management. By implementing Human Resource Management functions effectively, companies can attract and retain suitable talent, promote diversity and inclusion, boost a positive work culture, and manage any legal and financial risks.