Sure, it’s possible to put the functions of a human resources department in a tidy little nutshell. For the most part, HR entails recruitment, workforce maintenance, and ‘rallying the troops’ to perform cohesively as well as efficiently.
However, that would drastically downplay the overall positive impact that a high functioning HR team can have on an organization – whether it’s large, medium, or small.
When delving deeper into a company’s overall operations, the reality of HR’s influence on day-to-day goings-on become increasingly evident. A significant portion of company leadership and identity can be attributed to the power of HR management strategies.
Below, we’re discussing ten core functions of any given company that are managed by the human resources department.
1. Planning for the Future
HR departments prioritize long-term planning for an organization. For example, they’ll cater recruitment strategies around the kinds of talent that an organization needs not only to succeed now, but in ten years, or even twenty years.
The scope of this kind of planning also plays a part in other HR functions, such as performance management, succession planning, and employee onboarding, etc.
Any viable HR plan is molded to the unique specifications of a business’s model. Each decision should be reached, taking into account a company’s overall mission.
For any HR manager to be successful with planning, they must harmoniously collaborate with all other departments. After all, an HR manager – for the most part – won’t be a sales expert, or a marketing guru, for that matter.
Therefore, it’s necessary to foster a relationship with sales leadership staff – which is conducive to productive communication. This way, the human resources team can gain further insight into relevant performance metrics, analytics, and data as they shape planning strategies.
2. Recruiting Top Talent
To an HR professional, hiring the ideal talent that adheres to a business’s needs and circumstances is a delicate art form.
Recruiters must master what goes into attracting the most superior candidates for interviews. And they also require skills that help accurately pinpoint the cream of the crop during the selection process.
Then, on top of those responsibilities, recruitment teams decipher whether a candidate’s personality and experience match the values and economics of a business. Sometimes, that entails hiring someone with less experience, but with more potential and at a more affordable price.
Attracting top-tier candidates for interviews necessitates a robust and attractive employer branding strategy. HR should collaborate with the marketing department to craft an alluring recruitment campaign.
There are also plenty of tools that help screen candidates before interviews. Some businesses even use chatbots. Offsetting recruitment costs is invaluable, as the process costs 30% of companies $1,000 - $3,000 per hire. That begins to add up over time—specifically if companies have high turnover rates.
While speaking of turnover rates, it's worth noting that quality recruitment drastically reduces turnover rates because it perfectly matches a candidate with the position. Research indicates that the average cost of turning over a highly skilled job is 213% of the yearly salary. Mitigating these detrimental costs is of the utmost importance.
3. Succession (Career) Planning
The notion of planning for the future was already discussed in this blog. Given the impact that long-term vision has on a company, HR should work alongside other leadership staff to earmark top-performing talent in entry-level and different non-management positions. From there, there’s a need to create a plan around fostering this talent’s growth in the company.
Internal promotions tend to be more fruitful for companies over time. According to comprehensive studies, external hires are 61% more likely to leave the company via layoff or outright termination within their first two years. These employees are also 21% more likely to leave the job than an internal promotion.
Furthermore, 86% of leaders view succession planning as a pressing priority.
Yet, a study from 2010 showed that only 54% of boards were grooming a specific successor for CEO. While 39% lacked an adequate internal candidate, who could immediately step into the role. There’s a reason that only 40% of new CEOs fail to meet performance expectations in their first 18 months in the position.
4. Evaluating Job Functions
Each position within an organization comes with an array of factors and functions that are weighed meticulously via HR departments.
HR assesses these functions through perspectives such as qualifications, quality, availability, location, work schedule, responsibilities, economics, and overall job value. The evaluation, ideally, will dictate which jobs are most similar and base the reward system on those shared traits.
Popular methods of evaluation are as follows:
- Categorizes jobs and ranks them using those guidelines
- Categorization accounts for factors such as:
- Specialized skills and demand for those skills
- Discipline-specific experts rank how crucial a job is to the company
- Compares functions and discerns which are more valuable
- After all functions run through the process, they are ranked accordingly
- HR categorizes jobs by how much it contributes to the overall success of a company
- Awards points to each category base on factors, such as:
- Technical knowledge
- Communication skills
- Business sense
5. Incentives and Rewards
Employees need rewards, otherwise, what’s the point of doing the job?
Yes, making a living (or even acquiring personal wealth) is undoubtedly an incentive in itself, but recognition goes beyond that. Matters such as status, culture, work-life balance, and career opportunities are also seen as viable rewards.
HR plays a huge role in deciding who receives rewards, why they are handed out, and what kind of incentives are offered.
6. Employee Engagement and Internal Marketing
Which is why HR departments take pains in cultivating a work environment where employees are more active in an organization.
As such, human resources departments usually plan company retreats to help nurture internal networking. They also ensure that employees remain informed and plugged into various relevant happenings throughout the company.
It’s a recurring trend to see more modern organizations treat their employees like customers—specifically top talent. HR, is in large part, responsible for establishing such a mentality.
7. Employee Wellness
According to research from Gallup, burned-out employees are 63% more likely to take a sick day and 2.6 times as likely to be actively seeking a different job If they aren’t looking for a new job, they’ll have 13% less confidence in their performance. And they'll be 50% less likely to discuss performance goals with leadership staff.
HR needs to pay attention to the signs of burnout while implementing and mandating practices that prevent it from happening in the first place. Furthermore, wellness and health go beyond burnout and include a focus on mental health and personal well-being.
When employees go through a personal crisis, and their well-being hangs in the balance, HR steps in if they’re aware of the problem.
8. General Administration
HR is tasked with administrative duties that divide into either personnel procedures or information systems.
Personnel procedures include managing promotions, disciplinary proceedings, performance improvement, regulations, diversity (gender, culture, and racial), and harassment, etc. These various issues necessitate standards and practices that’ll help offset any lingering problems.
The HR information systems have to do with storing employee and performance data for informed decision making.
9. Employee Off-boarding
When top-performing talents leave a company, it doesn’t have to be negative. In fact, it can be quite the opposite if an HR department has procedures in place to ensure a smooth, pleasant transition.
For one thing, employees departing on positive terms will put their best foot forward when passing down knowledge to their replacement. Plus, former employees who see their old employer in a positive light will refer both consumers and candidates without hesitation.
Lastly, when departing talent are off-boarded the right way, it increases the chance they’ll return as boomerang employees. The benefits of these kinds of rehires is that is slashes 50% off the costs from the recruitment process. Boomerang employees already know the culture of a company and are returning with more experience and knowledge.
10. Safety and Health Standards
Human resource departments are synonymous with health and safety regulations. It’s one of the primary functions of HR, and these rules are implemented to both protect employees and the company from potential disasters.
Shell, the oil conglomerate, forbade its employees from walking its stairs without hands on the safety rails. The initiative was known as ‘Goal Zero,’ which intended to prevent even one accident from happening.
Interestingly, Shell enforced this rule at their own headquarters, despite the mandate only meaning to protect those at the oil rig. But it highlighted just how vital safety was to the company’s culture.
HR Management is So More Than What Meets the Eye
Yes, these are all definitive core functions of any HR department—specifically productive ones. However, this is only really scratching the surface. The multifaceted nature of HR far exceeds hiring, firing, policies, and procedures. Instead, these departments shape the entire culture and personality of small, medium, and large-sized organizations.