Human Resource Management (HRM)

Article by: Ben Janse

Last update: January 7, 2024

Human Resource Management: this article provides a practical explanation of Human Resource Management (HRM). Next to what it is (including a definition), this article also higlights human Resource Management fundamentals and core activities, HRM and company capital an the new Roles for the Human Resource Manager. After reading, you will understand the basics of this management discipline. Enjoy reading!

What is Human Resource Management (HRM)?

The definition of Human Resource Management

Human Resource Management (HRM) is the art of managing employees, so that they can get the most out of themselves to achieve organisational objectives.

Managing people within an organisation is a comprehensive process, which includes: recruiting new people, performing job analyses, providing training, managing salaries, communicating with all employees, managing conflicts, evaluating performances, and complying with labour laws. Naturally, there are many other important components within Human Resource Management (HRM).

The primary goal of Human Resource Management is to guarantee the availability of the right candidates for the right jobs at the right time. Because it covers so many fields—including psychology, communication, economy, and sociology — HRM is multidisciplinary topic.

Human Resource Management (HRM) ensures individual, but also organisational and social goals can be achieved. It is a continuous process, which is to say it requires more than just a couple of monthly inspections. Human Resource Management (HRM) is also about team spirit, team work, and a pleasant work environment.

The idea of Human Resource Management (HRM) is said to have originated in Europe three centuries ago. At the end of the 18th century, at the height of the Industrial Revolution, Robert Owen and Charles Babbage were born.

Both were of the opinion that people were critical to the success of an organisation. It was precisely at this time that the value of human labour (Marxism) drastically reduced, mainly due to the high productivity of machines that met all the wishes and needs of the population.

Human Resource Management Fundamentals and Core Activities

Task Analysis

Task analysis involves the systematic identification of fundamental elements of a specific job and examining the characteristics and skills required to perform said job.

This information is prepared and used by the Human Resource Management (HRM) department. Here it is applied in the development of, for example, objectives, evaluation tools, and training programmes.

Organisation, Deployment, and Maintenance

The organising, deploying, and maintaining of an entire group of staff can be a significant challenge for the Human Resource Management (HRM) department. Challenges include recruitment and selection, hiring, evaluation and attract new talent.

Training is often described as an endeavour aimed at improving and developing certain competencies or skills of an employee working at an organisation at that time, with the aim to improve employee performance or productivity. This training is often tailored to specific competences.

Assessment

Assessment interviews and evaluations are important company resources, which benefit both the employer and employees. The fundamentals of an assessment interview lie in the job description.

The job description includes the responsibilities and tasks that are essential for the evaluation of a new employee.

In addition, certain competences are linked to specific jobs. These also provide a framework for later evaluation. Of course, no evaluation system will remain effective forever.

Job requirements change and organisational needs do not always remain the same. Human Resource Management (HRM) must therefore continuously review its evaluation system in order to ensure it doesn’t compromise the employee and employer requirements.

Human Resource Management and company capital

Human Resource Management (HRM) manages different types of company capital. A distinction is made between:

Intellectual Capital

Intellectual capital refers to all resources that add value to the company. This often concerns information. For example, information with regards to the customer base, the company and strategy itself, suppliers, processes, and stakeholders.

For this reason, intellectual capital does not just refer to knowledge of the organisation, but also of the entire market or industry. This makes it a combination of cognitive, intuitive, and experience-related knowledge.

Social Capital

Business-related social networks are ever expanding, and are receiving increasing attention within today’s organisations. One advantage of social interactions on and off the work floor is the determination of the social capital of both employees and the organisation as a whole.

Social capital is defined as ‘the characteristics of social organisations’. This includes networks, standards, and the social trust that partnerships provide mutual benefits.

The balance between different types of capital must be in such a way that it encourages a productive culture. The challenge for HRM is to involve the mindsets, emotions, and intellect of employees in performing their organisational tasks.

Talent is a Business Priority and Inbound Recruiting can help

New Roles for the Human Resource Manager

As a Human Resource Manager (HRM), one must juggle multiple tasks simultaneously. As a result, the manager takes on many different roles every day. These roles have changed a lot throughout the years, and future HR managers are expected to take on four different roles. These roles are explained below.

Strategic Partner

Although the Human Resource Manager (HRM) is by no means always involved in business operations, his role as strategic adviser shouldn’t be surprising. In this role, the HR manager is involved in the development of the business strategy together with senior management.

The HR manager holds serious meetings about how to organise the company and make its HR strategy as effective as possible. Human Resource Management (HRM) must primarily be involved in defining the organisational architecture.

Various tools are available for this, including the McKinsey 7S model. Management must request Human Resource Management (HRM) to produce a blueprint of the building layout, its various components, and the ways in which collaboration takes place.

Finally, the HR manager must be involved as strategic partner in identifying methods for improving and maintaining the organisational structure.

HR managers must be guided in the process of proposing, developing, and discussing certain programmes or ideas for the purpose of the appraisal and reward system.

Administrative Expert

In the role of administrative expert, HR managers must deviate from the traditional form of policy control within organisations. In order to take on the role of administrative expert and ensure that routine work is performed properly, the HR manager is often required to multitask.

The advantage of an HR manager as administrative expert is first of all to reduce costs by removing technology or others steps from complex business processes. Making these processes more efficient also increases the credibility of the manager, which further opens the door for a position in strategy negotiations.

In this way, Human Resource Management (HRM) influences all aspects of business operations.

Employee Associate

Managers often demand the utmost of employees. In general, they are often asked to do more with fewer sources. If managers were to have complete say, employees would start to become disillusioned with their jobs. Moreover, the relationship with the organisation would become more of a transactional one.

This is a form of organisational failure. Companies cannot perform well if their employees are not sufficiently involved. This is why HR managers must be held responsible for keeping employees satisfied. The greater the employee involvement, the greater the employee contribution to the employer.

HRM must therefore take responsibility for the orientation and training of management and the importance of a high level of moral among employees.

Modern HR managers serve as the voice of employees, and must offer them opportunities for both personal and professional growth and the means that make this possible.

Change Facilitator

Organisational changes are being implemented faster than ever before and the main differences between the winners and losers of these changes is their ability to adapt. Winners adapt quickly, losers waste time trying to control change.

The role of modern HR managers is to ensure change is embraced and capitalised on. This ensures the door is opened for innovations or the implementation of new technology. People are scared of change, and the role of the HR manager is to remove this fear and replace it with determination.

Now it’s your turn

What do you think? Are you familiar with the explanation of Human Resource Management (HRM)? How are human resources managed in your own work environment or organisation? What do you believe are crucial elements of Human Resource Management (HRM)? Do you agree with the above, or do you have anything to add?

Share your experience and knowledge in the comments box below.

More information

Wright, P. M., & McMahan, G. C. (1992). Theoretical perspectives for strategic human resource management. Journal of management, 18(2), 295-320.
DeCenzo, D. A., Robbins, S. P., & Verhulst, S. L. (2016). Fundamentals of Human Resource Management, Binder Ready Version. John Wiley & Sons.
Bratton, J., & Gold, J. (2017). Human resource management: theory and practice. Palgrave Macmillan.
Caldwell, R. (2003). The changing roles of personnel managers: old ambiguities, new uncertainties. Journal of Management Studies, 40(4), 983-1004.
Unknown. (2024). HubSpot’s Guide to Choosing a Recruitment CRM for Your Business. Retrieved 01/07/2024 from HubSpot: https://www.hubspot.com/products/crm/recruiting.

How to cite this article:
Janse, B. (2019). Human Resource Management (HRM). Retrieved [insert date] from Toolshero: https://www.toolshero.com/human-resources/human-resource-management/

Original publication date: 05/17/2019 | Last update: 01/07/2024

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Article by:

Ben Janse

Ben Janse is a young professional working at ToolsHero as Content Manager. He is also an International Business student at Rotterdam Business School where he focusses on analyzing and developing management models. Thanks to his theoretical and practical knowledge, he knows how to distinguish main- and side issues and to make the essence of each article clearly visible.