Importance and Functions of HRM

hrm functions

Employees are the most valuable asset of an organization. Their level of motivation determines the overall performance and success of the organization. This is why the organization should effectively manage human resources, train and reward them for a productive, thriving workforce. Here are six basic HRM functions and its importance for an organization.

HRM Functions

1. Recruitment and selection

The primary function of human resource management is to recruit the right talent that meets needs of the company. Recruitment is a broad term that falls into two categories: attracting skilled talent and hiring right candidates. This means HR department is responsible for defining requirements of the organization, attracting and recruiting the right people.

2. Employee training and development

After hiring, HR department has to train the recruited candidates. However, they should first assess the training needs of each employee to deliver the best training possible. Training and development should always be focused on improving the present and future employee performance. Taking into account training needs and company opportunities, HR department decides which type of training is more suitable to improve skills of employees in various aspects.

3. Employee relations

hrm functions

As main asset of an organization, employees need to get on well with each other and the organization they are working for. HRM is responsible for influencing the performance of each employee. HR department is responsible for organization of activities to understand all employees at personal and professional level.

4. Managing Payrolls

Payroll management not only deals with the salaries and compensation of employees. It also plays a crucial role in protecting the image of a company. Proper payroll management helps a company to comply with a variety of legislation. HR department conducts research and analyses the pay practices and salary trends of employees. In addition, HR department formulates various compensation plans and strategies such as medical insurance, reimbursements, bonuses, incentives, and provident fund and much more.

5. Performance appraisalhrm functions

Performance appraisal is an important aspect of HRM as it can provide a company with the basis for salary adjustments, training development and job promotion. HR department is responsible for conducting appraisal and other reward management practices based on Key Performance Indicators.

6. Motivating Employees

Employee Motivation is one of the most important functions of HRM. Motivated employee tends to show better results rather than unmotivated. Thus, HR manager should be able to determine factors which cause lack of motivation and eliminate them. One of the best thing that motivates employees is recognition of their accomplishments. People want to feel that their work is valued. This fulfills people’s basic needs of belonging, esteem and self-actualization.

Reasons why HRM is important for an organization

Liability issues

Cases of discrimination during recruitment and unfair promotions can put an organization at risk. There is even a possibility that the company may be exposed it various liability issues. HR department helps to identify potential accusations. It investigates and resolves problems in the workplace. Most of these issues can pose significant hazards related to federal and state rules if left unattended.

Organization safety

Every organization should maintain a safe and reliable working environment for all employees. HR department collaborates with the security department to develop emergency resolution strategies to reduce workplace violence.

Competitive advantage

By hiring the right personnel, developing and training employees, HR department can help place an organization at a competitive edge. As a result, the organization can thrive and outcompete others in the same niche.

Good relationships in the organization

HRM helps to maintain good working relationships between employees and organization. The result is reduced strikes and employee turnover which can affect the good performance of a company. Teamwork can be enhanced through proficient HRM.

Talent preparation

Employee training and development is essential not only for occupational demands but for future success. The same skills enable them to advance to higher job grades. Therefore, HRM prepares employees for future talent needs of the company.

Recommended articles: How to promote my business fast?How to improve your credit score fast?


Please enter your comment!
Please enter your name here