1. HR Glossary
2. Human Resources (HR)

Human Resources (HR): Definition and Roles Responsibilities

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What is Human Resources?

Human resource or HR is a department that manages the people of an organization. It handles all the activities of an employee cycle, such as recruitment, onboarding, performance management, skill development, and offboarding.

These activities include paying salaries, addressing any employee concerns, complying with relevant labor regulations, and many more. You will get to know more about these activities in a moment. First, let’s briefly explore the evolution of HR.

How has HR Evolved?

In the 20th century, HR was known as the department of personnel administration. This department’s primary function was to address employee concerns and maintain workplace safety.

However, from the 1980s onwards, the HR department started to evolve as a strategic department as well. Earlier, HR only managed attendance and paid salaries.

Now, the HR manages all the people-centric functions such as performance appraisal, recruitment, talent development, and even decision-making.

Role of Human Resources

HR plays a very important role in any organization. HR professionals help in complying with labor regulations. They also review performance and recruit the right talent.

Some other key responsibilities include maintaining records and providing support to employees.

• Manage payroll: This is one of the main responsibilities of an HR professional. Particularly, they need to comply with wage and hour regulations.
• Comply with other labor regulations: These professionals also need to make sure that organizational practices are in line with regulations like GDPR and DPDP (Digital Personal Data Protection Act)
• Review performance: Another key responsibility of HR is to manage employee performance. They create goals, facilitate interaction, and discuss performance improvement plans with employees if necessary.
• Administer benefits: HRs also administer benefits and encourage employees to participate in various initiatives.
• Recruit top talent: HR heads also need to find the right talent fit for available positions. They also make sure that the employee provides all the documents during the onboarding process.
• Engages employees: At times, it's possible that some employees feel disengaged due to personal or organizational reasons. HR leaders implement targeted initiatives and improve employee happiness.
• Develop talent and plan for succession: CHROs (Chief Human Resources Officers) also focus on developing the talent pipeline. This ensures business continuity.
• Retain top talent: Another role that an HR professional plays is that of retaining high-performing employees. Leaders implement retention strategies and design targeted compensation programs.
• Manages the human capital: Now, HR also aligns departmental and individual goals with an organization’s outcomes.

Importance of HR in Organizational Success

The HR department is as important as the finance department of an organization. HR manages the most important asset of any organization: its people.

The department is important for the following reasons:

• The HR department manages payroll and pays salaries on time. This can improve employee satisfaction. Timely payments are also important from a compliance perspective.
• It improves the overall productivity of your organization by reducing turnover and retaining top talent.
• HR professionals also keep themselves updated regarding the recent changes in employee regulations. These updates help you to comply with the evolving legislation of a region and avoid penalties.
• Strategic HR management can also be useful in improving collaboration between different departments of your organization.
• HR professionals can help you identify skill deficiencies as they review performance and analyse external trends.

Types of HR Jobs

Recruitment and Staffing

Recruitment and Staffing involve three key processes:

1. Identifying hiring needs based on skill deficiencies and available positions,
2. Sourcing candidates with the help of job portals, and,
3. Selecting the right candidate with simulations and interviews.

Administration Function

The HR department is the backbone of the administration of any organization. The primary functions include:

• Processing payroll: This includes timely payments and record maintenance. Digital payslip generation is also becoming an important function.
• Compliance management: The HR department also complies with tax regulations and other regulations.
• Maintaining records: HR professionals used to maintain physical registers. However, increased digitization is prompting organizations to store such records in cloud centers.

Rewards and Benefits

HRs also administer benefits. Attractive compensation packages can help attract new and old employees. Some of the common benefits include performance-based incentives, attractive salary packages, complementary memberships, and retirement benefits. Some organizations also offer health insurance.

Career Planning

Career planning is very important for junior and mid-level employees. This aspect focuses on skill development opportunities. Leaders also design targeted learning and development initiatives for upskilling their organization’s workforce.

Employee Onboarding and Training

Employee onboarding and training consist of two major aspects: onboarding and training. In onboarding, HR professionals make sure that they gather all the relevant documents. These documents include details related to identity and previous tax records. In training, HR professionals provide training to employees about organizational policies and work culture. They also provide personalized skill development programs if necessary.

Performance Management

In this function, performance expectations are set, feedback is given, and the employee's performance is measured. This process reveals the employee's strengths, weaknesses, and areas for improvement.

Employee Relations

HR Builds and maintains positive relations between employees. This relationship-building includes handling employee grievances, resolving conflicts, and ensuring a friendly work environment.

Compliance and Legal Issues

HR professionals also oversee compliance with labor regulations. They perform several functions, such as conducting audits and updating their tax criteria, among others. This function is particularly important for organizations, as failing to comply with local/global regulations can result in hefty penalties.

Leading Challenges in Human Resources

There are a number of challenges in HR management related to different aspects. Some of the aspects include recruitment and retention, change management, and evolving regulations, among others.

Recruitment and Retention

Recruiting the right talent in this time of great talent stagnation is difficult. However, retaining talent is even more difficult. HR leaders would need to design targeted skill and development initiatives to meet the requirements posed by technological advancements and industry demands.

Managing Change

Change management is another big challenge faced by HR leaders. Clear and honest communication about a change would be a good starting point to address any potential concerns. Change is the only constant in an ever-competitive business landscape. So, HR professionals will need to design flexible strategies and focus on reskilling rather than replacing employees.

Compliance Issues

Navigating the complex landscape of employment laws and regulations is a critical responsibility. Staying up-to-date with evolving legislation, ensuring compliance with federal, state, and local employment laws, and managing potential legal risks are ongoing challenges. They must also address issues such as workplace harassment, discrimination, and safety to maintain a compliant and ethical work environment.

HR Best Practices

Here is a concise checklist of some common HR best practices:

• Transparent communication: Sharing information on time, encouraging employees to give feedback, and maintaining an open-door approach are some of the measures you can take as an HR professional.
• Employee development: A skilled and developed workforce will help you in achieving tangible growth. Promote mentoring initiatives and encourage inter-departmental collaboration. Designing targeted initiatives can also help employees be more productive. Such initiatives would also help them grow as a professional.
• Work-life balance: At a time when burnout seems to be the new normal, a flexible policy can help you maintain the work-life balance of your workforce. Such a policy would also help in attracting and retaining employees. Provide for flexible working arrangements and design work policies for in-office, hybrid, and remote work scenarios.

FAQs

How to Measure the ROI of HR Initiatives?

Initiative ROI can be measured using KPIs like employee turnover, time-to-fill, engagement, and more. This will lay down a quantitative basis for measuring results. Connecting human resource goals to overall business objectives can enable employers to see the actual worth of their human resource function.

What Precisely does HR do?

In layman’s terms, the HR (Human Resources) department manages the employee life cycle (i.e., recruiting, hiring, onboarding, training, and terminating people) and administers employee benefits.

Is the Human Resources Department Imperative in a Company?

Yes, a human resources department is necessary in any organization. HR is responsible for acquiring, maintaining, and developing personnel, ensuring labor law compliance, and creating a healthy work environment. This eventually improves the company’s overall performance and productivity.

Does HR have the Final Decision when Hiring a Candidate?

In many firms, HR is on the front line of the recruiting process, advancing only the most well-examined candidates to the interview stage. The recruiting manager, often outside the HR department, has the final word on who receives the position.

What is Human Resource Planning?

Human resources planning, or HR planning, is a process that helps align the available resources with business goals. It includes addressing both short-term and long-term requirements of an organization.

What is Strategic HR Planning?

Strategic HR planning includes analysing current and future requirements and calibrating departments to those requirements. For example, if an organization wants to prepare for artificial intelligence, it would design projects where data scientists, software developers, coders, and experts in computational linguistics would work together.

How Many Types of Functions are Performed by an HR Professional?

An HR professional performs these three types of functions. 1) Administrative, 2) Operational, and 3) Strategic.

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