What Is Human Resource Management (HRM)? How Does It Work? (2022)

The process of managing individuals within a company is known as human resource management. HRM includes activities such as hiring, firing, training, and developing employees. The goal of HRM is to ensure that the right number of people with the right skills are in the right places at the right times to achieve the organization’s goals.

Table of Contents

  • 1 History of Human Resource Management
  • 2 What is Human Resource Management?
  • 3 Definitions of Human Resource Management
  • 4 Characteristics of HRM
  • 5 Principles of HRM
  • 6 Functions of HRM or What is HRM?
    • 6.1 Basic Functions of HRM
    • 6.2 General Functions of HRM
  • 7 Phases of HRM
  • 8 Philosophy of Human Resource Management
  • 9 Importance of HRM
  • 10 Objectives of HRM
  • 11 Human Resource Management Models
  • 12 Means to Success of HRM
  • 13 Factors Determining the Efficiency of HRM
  • 14 Problems of HRM
  • 15 Means to Overcome the Problems of HRM
  • 16 How Does Human Resource Management Work?
  • 17 Why Should You Try Human Resource Management?

History of Human Resource Management

The modern field of human resources began to take shape in the early 20th century. However, it was not until the aftermath of World War II and the great depression that HR truly came into its own. In 1910, amid a period of labor unrest and social upheaval, David Dubin published the first-ever book on the topic of HR. The following decade saw the passage of Title VII of the Civil Rights Act, which brought the fight for civil rights to the workplace.

As the baby boomers came of age in the 1960s, they began to push for increased rights and opportunities in the workplace. This led to clashes with older generations who were more comfortable with the status quo. At the same time, technology was rapidly evolving, forcing HR to adapt just to keep up. In 1980, global trade and communication exploded with the advent of the personal computer. Suddenly, companies had to compete with businesses all over the world, and the role of HR shifted from simply managing payroll and benefits to managing an organization’s entire workforce.

(Video) Human Resource Management (HRM) Explained – Everything you Need to Know

However, if you want to know details about it, you should read the two articles one is A Brief History of Human Resource Management and another is Evolution and Development of HRM in Bangladesh.

What is Human Resource Management?

HRM provides a suite of services designed to help companies make more informed decisions about how to allocate their resources. These services include:

  • Business Process Optimization – This service analyzes a company’s current processes and recommends improvements based on data collected from its employees.
  • Human Capital Analytics – This service uses AI to analyze employee performance and identify areas where improvement is needed.
  • Performance Management – This service allows managers to track and measure the performance of individual employees.
  • Talent Acquisition & Retention – This service helps companies recruit and retain top talent by providing them with insights into what makes people successful at work.

Definitions of Human Resource Management

Human Resource Management has defined as a process of acquisition, development, motivation, maintenance, and utilization of manpower in an organization for purpose of achieving predetermined goals. Human Resource Management is related to a few aspects of Human Resources working in the organization.

Human Resource Management has been defined in many ways by different authors. These definitions are given below.

Human Resource Management is the set of organizational activities directed at attracting, developing and maintaining an effective work force. Ricky W. Griffin

(Video) HR Basics: Human Resource Management

The policies and practices involved in carrying out the people of human resource aspects of a management position including recruiting, screening, training, rewarding and apprising. Gray Dessler

Human Resource Management is a series of decisions that affect the relationship between employees and employers; it affects m

any constituencies and is intended to influence the effectiveness of employees and employers. George T. Milkovich, and John W. Boudreau

Human Resource Management is the provision of leadership and direction of people in their working or employment relationship. Dake Yoder

Human Resource Management many be defined as a set of activities which include acquisitions, development, motivation, maintenance and utilization of manpower for the purpose of effective and timely achievement of organizational goal/s. M. Ataur Rahman

(Video) What is Human Resource Management?

Human Resource Management is the use of Human Resources in an organization through the management of people related activities. John H. Jackson, Robert L Mathis, and Sean R. Valentine

Human Resource Management is comprised of the staffing, development, motivation and maintenance functions. Each of these functions however is affected by external influences. David A. DeCenzo and Stephen P. Robbins

From the above discussion, we can say that Human Resource Management is the set of activities relating to procuring, developing, maintaining, and utilizing a group of people for the proper function of organizational activities and achievement of goals.

Characteristics of HRM

  • Development of well-conceived policy
  • Development of harmonious relations
  • Establishing a chain command
  • Awareness of own nature of services
  • Acquire full professional and operational knowledge
  • Must be good communication and effective leader. Know to expand the characteristics of human resource management.

Principles of HRM

  • Scientific selection
  • Employee development
  • Labor-management cooperation
  • Free flow of commutation
  • Principles of fair remuneration
  • Incentive
  • Dignity of labor
  • Participation
  • Contribution, and
  • Team spirit. Get details on the Principles of Human Resource Management.

Functions of HRM or What is HRM?

There are two types of functions of HRM. One is the basic functions of HRM and another is the general functions of HRM. Such as-

Basic Functions of HRM

  • Acquisition
  • Development
  • Motivation
  • Maintenance

General Functions of HRM

  • Formulation of Human Resource Policies
  • Recruitment of skilled human resources
  • Selection and posting of human resources
  • Job analysis and description
  • Promotion and transfer
  • Orientation and socialization
  • Training and development
  • Career planning and development
  • Job evaluation
  • Performance appraisal
  • Remuneration
  • Providing benefits and incentives
  • Handling grievances
  • Maintaining discipline
  • Worker’s participation
  • Labor-management relations
  • Reduction of dispute
  • Managing trade unions
  • Collective bargaining
  • Maintenance of working environment

If you want to know the details of these basic and general functions with practical examples. You can read the functions of human resource management article.

What Is Human Resource Management (HRM)? How Does It Work? (1)
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Phases of HRM

  1. Pre-Hiring Phase: Human resource planning and job analysis.
  2. Hiring Phase: Staffing involvement in policies and procedures through recruiting and selecting employees.
  3. Post-Hiring Phase: Getting expertness through training and development to gain effective results in the current and the future job span.

These phases are very effective to install HRM successfully in an organization or business. So, you should learn it in detail. You can get it in detail from the effective Phases of Human Resource Management article.

Philosophy of Human Resource Management

Any organization’s essential principles for managing human resources come from its approach to people. Every firm has a philosophy, even though it is not documented. It offers guidance on personnel policies. There are two opposing perspectives on employees at work.

  1. Technical Factor: The technical element of the production is considered to be labor.
    They are handled like a commodity and are exchangeable.
  2. Human Factor: The human element of labor has been seen as having several potential advantages.
    Therefore, they need to be treated with decency and respect.

Importance of HRM

  • Policy formulation
  • Policy execution
  • Review of employee needs
  • Utilization of human resources
  • Social welfare
  • Effective trade unionism
  • Overall development of the organization

Objectives of HRM

  • To select skilled employees
  • To develop efficiency and skills of employees
  • To ensure effective performance of employees
  • To change employee behavior
  • To train subordinates
  • To increase job satisfaction
  • To attract good people
  • To ensure discipline
  • To coordinate among different functions, and
  • To develop working conditions. Read more about the Objectives of Human Resource Management.

Human Resource Management Models

  1. Human Resource Planning
  2. Recruitment and Selection
  3. Promotion and Transfer
  4. Job Design and Analysis
  5. Training and Development
  6. Job Evaluation
  7. Rewards and Benefits
  8. Merit Rating
  9. Career Development
  10. Grievance Handling
  11. Disciplinary Action
  12. Disciplinary Action
  13. Employee Service or Welfare
  14. Communication
  15. Human Resource Costing and Audit
  16. Labor Relations

Means to Success of HRM

  • Proper policy
  • Acceptability of policies
  • Capability
  • Top management support
  • Trade union support
  • Impartiality

Factors Determining the Efficiency of HRM

  • Total labor productivity
  • Presence of efficient employees
  • Nature of labor-management relations
  • Frequency of labor turnover
  • Rate absenteeism
  • Volume of training
  • Utilization of human resources
  • Efforts for employee services

Problems of HRM

Human resource management faces a lot of problems. These problems can be classified into many types. These are mentioned below-

  • Shortage of professional management
  • Lack of skilled human resource manager
  • Insufficient number of the HR organization
  • Absence of human resource planning
  • Change of job of the human resource manager
  • Lack of career planning and program
  • Absence of proper evaluation
  • Lack of motivation
  • Lack of suitable relations between labor and management
  • Negative politics

Means to Overcome the Problems of HRM

The following measures may be effective to solve the problems of HRM. If all these measures are taken carefully, we hope problems may be solved successfully.

  • Effective human resource planning
  • Proper establishment
  • Long-time job as a human resource manager
  • Possibility of career planning and program
  • Positive relations between labor and management
  • Proper job evaluation
  • High professional management
  • The ability of a skilled human resource manager
  • Proper human resource motivation
  • Positive working conditions.

In problems of human resource management are manifold. So, multidimensional measures can be used to solve the problems. Business and industrial organizations must afford these measures.

(Video) What Does HR Actually Do? (A Brief Summary)

How Does Human Resource Management Work?

Human Resource Management works by analyzing data from an organization’s workforce. Using this data, the system identifies trends and patterns that can then be used to improve business operations.

Why Should You Try Human Resource Management?

Businesses often struggle with how to effectively use their human capital. This is especially true when it comes to managing employees who work remotely. Remote workers are more likely to leave jobs than those who work in the office, so companies need to make sure they’re doing everything possible to retain them.


What is human resource management and how it works? ›

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).

What is human resource management answer? ›

Human resource management (HRM or HR) is the strategic and coherent approach to the effective and efficient management of people in a company or organization such that they help their business gain a competitive advantage. It is designed to maximize employee performance in service of an employer's strategic objectives.

Why are human resources important answer short answer? ›

HR plays a key role in developing, reinforcing and changing the culture of an organisation. Pay, performance management, training and development, recruitment and onboarding and reinforcing the values of the business are all essential elements of business culture covered by HR.

Where can HRM work? ›

Human resource managers also work for schools boards and in elementary, middle and high schools as well as colleges, universities and technical schools. In elementary, middle and high schools, they may help principals interview and hire the most qualified teachers, secretaries, nurses and school psychologists.

What is human resource management essay? ›

Human resource management may be defined as a set of policies, practices and programmes designed to maximise both personal and organisational goals. It is a process by which the people and organisations are bound together in such a way that both of them are able to achieve their objectives.

What is HRM example? ›

Human Resource Management, or HRM, is the practice of managing people to achieve better performance. For example, if you hire people into a business, you are looking for people who fit the company culture as they will be happier, stay longer, and be more productive than people who won't fit into the company culture.

Why is human resources most important? ›

Employees are the foundation of every successful business. This is why human resource (HR) management is so important. The HR department performs a wide variety of duties and is responsible for helping employees feel safe, valued and properly supported.

What is the purpose of human resources? ›

In simplest terms, the HR (Human Resources) department is a group who is responsible for managing the employee life cycle (i.e., recruiting, hiring, onboarding, training, and firing employees) and administering employee benefits.

Why is HRM important to an organization? ›

Human resources management is a very important function in every organization. Without human resources management, companies would not be able to effectively recruit and retain employees, improve and enhance the organization, and they wouldn't be able to maintain a healthy, accepting workplace culture and environment.

Why is HRM important to all managers? ›

HRM can be defined as the effective management of people in an organisation. HR management helps bridge the gap between employees' performance and the organisation's strategic objectives. Moreover, an efficient HR management team can give firms an edge over their competition.

Why is human resources important for development? ›

Human resources development is important because it is an investment in one's employees that will ultimately result in a stronger and more effective workforce. When an organization develops their employees, they are strengthening their assets and making these employees even more valuable.

What do I need to work in human resources? ›

A bachelor's degree is the typical entry-level education for an HR specialist. Most of the time, professionals have a bachelor's degree in human resources because they are ready to make an impact from day one. Human resource managers plan and direct the administrative functions of an organization.

What is the importance of studying human resource management essay? ›

Studying human resource management helps professionals to effectively assess the relevant candidates based on personal traits and critical skills required for the job.

How do you study Human Resource Management? ›

How to Become an HR Manager
  1. What is an HR Manager and What Do They Do? ...
  2. Step 1: Graduate from High School (Four Years) ...
  3. Step 2: Earn a Bachelor's Degree (Four Years) ...
  4. Step 3: Complete an Internship (One Year or Less) ...
  5. Step 4a: Gain HR Work Experience (At Least Two Years)

What did you learn from HRM? ›

Managing people and client relations is an important skill to acquire in business, and this is just one aspect of HR that you can apply to any job. Other useful skills you will learn include organisation, administration, multitasking, presentations, reporting and communication.

What is the conclusion of human resource management? ›

In conclusion, the process of human resource planning is vital in assessing both thecurrent and future personnel needs of an organization in terms of quantity as well as quality. It isa fundamental process that directly links human resource activities to the organizational plansand objectives.

What I have learned in human resources? ›

They also learn how to conduct effective onboarding of new employees, how to support the professional development of employees, how to develop and implement employee training programs, and how to effectively measure and enhance job performance.

What is human resources in simple words? ›

What is Human Resources (HR)? Human resources (HR) is the department within a business that is responsible for all things worker-related. That includes recruiting, vetting, selecting, hiring, onboarding, training, promoting, paying, and firing employees and independent contractors.

How HRM helps business success? ›

The function of Human Resource Management contributes an important role in assuring employee satisfaction, develop business productivity and performance. It can also provide the organization with a clear vision of competitive advantage and contribute affectively to the organizational success in general.

How does HR improve business performance? ›

Identity: HR can clarify the meaning of purpose, value, and culture. Companies that execute with purpose have greater odds of creating significant long-term value generation, which can lead to stronger financial performance, increased employee engagement, and higher customer trust.

Is human resources important in a business? ›

Human resources, or HR, is important for every organization that has employees, as HR handles a wide variety of tasks related to business operations. HR can help recruit and retain high-quality employees that make a business more effective. HR also ensures compliance in ways related to company, state and federal rules.

How human resources can be developed? ›

Human resource development may be conducted formally, through training and education, or informally, through mentorship and coaching. Human resource development is important for cultivating an engaged and motivated workforce and leads to superior business results.

How can we develop human resources describe its process? ›

Human resource development is the process of assisting employees in a certain organization to improve their personal and organizational skills, their abilities and use of knowledge. This includes helping them through taking them for training, career development courses, organizational and performance management.

What are the 7 roles of HR? ›

What Does an HR Manager Do? 7 Functions of the Human Resources Department
  • Recruitment and Hiring.
  • Training and Development.
  • Employer-Employee Relations.
  • Maintain Company Culture.
  • Manage Employee Benefits.
  • Create a Safe Work Environment.
  • Handle Disciplinary Actions.

What are the 4 types of HR? ›

recruitment. labor relations. training and development. human resources information systems (HRIS) professionals.

What are the 3 main responsibilities of human resources? ›

What are the three major roles of human resources management? Running payroll, writing job descriptions, creating workplace policies and procuring benefits packages are typical of HR administration.

What is human resources in simple words? ›

What is Human Resources (HR)? Human resources (HR) is the department within a business that is responsible for all things worker-related. That includes recruiting, vetting, selecting, hiring, onboarding, training, promoting, paying, and firing employees and independent contractors.

Why is human resources important? ›

Employees are the foundation of every successful business. This is why human resource (HR) management is so important. The HR department performs a wide variety of duties and is responsible for helping employees feel safe, valued and properly supported.

What is the most important role of HR? ›

A human resource manager's primary objective is to oversee a company's administrative function, including: Talent recruitment. This involves scouting prospective candidates, coordinating interviews with qualified applicants, and establishing an onboarding process for new hires. Payroll and benefits.

Why do we need to study HRM? ›

Managing people and client relations is an important skill to acquire in business, and this is just one aspect of HR that you can apply to any job. Other useful skills you will learn include organisation, administration, multitasking, presentations, reporting and communication.

Why is it called HR? ›

When you hear the term “human resources,” often the first thing that comes to mind is the department that handles the people stuff. But if you think about it, the name is about the “humans” who happen to be employees.

What is structure of HRM? ›

One of the key resources in an organisation is undoubtedly human resources. It is the management structure that makes decisions concerning the management of people within the organisation, beginning with employee remuneration, recruitment, job rotation, job description, training and more.

What are the nature of HRM? ›

Nature of HRM:

It involves procurement, development, maintenance and management of human resource. It helps to achieve individual, organizational and social objectives. HRM is a mighty disciplinary subject. It includes the study of management psychology communication, economics and sociology.

What is human resources and examples? ›

Human resources (HR) is the division of a business responsible for finding, screening, recruiting, and training job applicants. HR also administers employee-benefit programs. A human resources department also handles compensation and benefits, and employee terminations.


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