Human
resource management (HRM, or simply HR) is the management of an organization's
workforce, or human resources. It is responsible for the attraction,
selection, training, assessment, and rewarding of employees, while also
overseeing organizational leadership and culture and ensuring compliance
with
employment
and labor laws. In circumstances where employees desire and are
legally authorized to hold a collective bargaining agreement, HR will also
serve as the company's primary liaison with the employees' representatives
(usually a labor union).
HR is a product of the human
relations movement of the early 20th century, when researchers began
documenting ways of creating business value through the strategic management
of the workforce. The function was initially dominated by transactional
work, such as payroll and benefits administration, but due to globalization,
company consolidation, technological advancement, and further research, HR
now focuses on strategic initiatives like mergers and acquisitions, talent
management, succession planning, industrial and labor relations, and
diversity and inclusion.
In startup companies, HR's duties
may be performed by trained professionals. In larger companies, an entire
functional group is typically dedicated to the discipline, with staff
specializing in various HR tasks and functional leadership engaging in
strategic decision making across the business. To train practitioners for
the profession, institutions of higher education, professional associations,
and companies themselves have created programs of study dedicated explicitly
to the duties of the function. Academic and practitioner organizations
likewise seek to engage and further the field of HR, as evidenced by several
field-specific publications.
HR spawned from the human
relations movement, which began in the early 20th century due to work by
Frederick Taylor. Taylor explored what he termed "scientific management"
(later referred to by others as "Taylorism"), striving to improve economic
efficiency in manufacturing jobs. He eventually keyed in on one of the
principal inputs into the manufacturing process—labor—sparking inquiry into
workforce productivity.
The movement was formalized
following the research of Elton Mayo, whose Hawthorne studies
serendipitously documented how stimuli unrelated to financial compensation
and working conditions—attention and engagement—yielded more productive
workers. Contemporaneous work by Abraham Maslow, Kurt Lewin, Max Weber,
Frederick Herzberg, and David McClelland formed the basis for studies in
organizational behavior and organizational theory, giving room for an
applied discipline.
By the time enough theoretical
evidence existed to make a business case for strategic workforce management,
changes in the business landscape (à la
Andrew
Carnegie, John Rockefeller) and in public policy (a là Sidney and Beatrice Webb,
Franklin D. Roosevelt and the
New Deal) had transformed the employer-employee relationship, and the discipline was
formalized as "industrial and
labor
relations". In 1913, one of the oldest known professional HR associations—the
Chartered Institute of Personnel and Development—was founded in England as
the Welfare Workers' Association, then changed its name a decade
later to the Institute of Industrial Welfare Workers, and again the
next decade to Institute of Labour Management before settling upon
its current name. Likewise in the United States, the world's first
institution of higher education dedicated to workplace studies—the School of
Industrial and Labor Relations—was formed at Cornell University in 1945.
During the latter half of the 20th
century, union membership declined significantly, while workforce management
continued to expand its influence within organizations. "Industrial and
labor relations" began being used to refer specifically to issues concerning
collective representation, and many companies began referring to the
profession as "personnel administration". In 1948, what would later become
the largest professional HR association—the Society for Human Resource
Management (SHRM)—was founded as the American Society for Personnel
Administration (ASPA).
Nearing the 21st century, advances
in transportation and communications greatly facilitated workforce mobility
and collaboration. Corporations began viewing employees as assets rather
than as cogs in a machine. "Human resources management", consequently,
became the dominant term for the function—the ASPA even changing its name to
SHRM in 1998. "Human capital management" is sometimes used synonymously with
HR, although human capital typically refers to a more narrow view of human
resources; i.e., the knowledge the individuals embody and can contribute to
an organization. Likewise, other terms sometimes used to describe the field
include "organizational management", "manpower management", "talent
management", "personnel management", and simply "people management".
HR has been depicted in several
popular media. On the U.S. television series of The Office, HR
representative Toby Flenderson is sometimes seen as a nag because he
constantly reminds coworkers of company policies and government regulations.
Long-running American comic strip Dilbert also frequently portrays
sadistic HR policies through character Catbert, the "evil director of human
resources". Additionally, an HR manager is the title character in the 2010
Israeli film The Human Resources Manager, while an HR intern is the
protagonist in 1999 French film Ressources humaines. Additionally,
the BBC sitcom dinner ladies main character Philippa is an HR
manager.
Dave Ulrich lists the functions of
HR as: aligning HR and business strategy, re-engineering organization
processes, listening and responding to employees, and managing
transformation and change.
In practice, HR is responsible for
employee experience during the entire employment lifecycle. It is first
charged with attracting the right employees through employer branding. It
then must select the right employees through the recruitment process. HR
then onboards new hires and oversees their training and development during
their tenure with the organization. HR assesses talent through use of
performance appraisals and then rewards them accordingly. In fulfillment of
the latter, HR may sometimes administer payroll and employee benefits,
although such activities are more and more being outsourced, with HR playing
a more strategic role. Finally, HR is involved in employee terminations -
including resignations, performance-related dismissals, and redundancies.
At the macro-level, HR is in
charge of overseeing organizational leadership and culture. HR also ensures
compliance with employment and labor laws, which differ by geography, and
often oversees health, safety, and security. In circumstances where
employees desire and are legally authorized to hold a collective bargaining
agreement, HR will typically also serve as the company's primary liaison
with the employee's representatives (usually a labor union). Consequently,
HR, usually through industry representatives, engages in lobbying efforts
with governmental agencies (e.g., in the United States, the United States
Department of Labor and the National Labor Relations Board) to further its
priorities.
The discipline may also engage in
mobility management, especially pertaining to
expatriates; and it is frequently involved in the merger and acquisition process. HR is
generally viewed as a support function to the business, helping to minimize
costs and reduce risk.
There are almost half a million HR
practitioners in the United States and thousands more worldwide. The Chief
HR Officer is the highest ranking HR executive in most companies and
typically reports directly to the Chief Executive Officer and works with the
Board of Directors on CEO succession.
Within companies, HR positions
generally fall into one of two categories: generalist and specialist.
Generalists support employees directly with their questions, grievances, and
projects. They "may handle all aspects of human resources work, and thus
require an extensive range of knowledge. The responsibilities of human
resources generalists can vary widely, depending on their employer's needs."
Specialists, conversely, work in a specific HR function. Some practitioners
will spend an entire career as either a generalist or a specialist while
others will obtain experiences from each and choose a path later. Being an
HR manager consistently ranks as one of the best jobs, with a #4 ranking by
CNN Money in 2006 and a #20 ranking by the same organization in 2009,
due to its pay, personal satisfaction, job security, future growth, and
benefit to society.
Human resource consulting is a
related career path where individuals may work as advisers to companies and
complete tasks outsourced from companies. In 2007, there were 950 HR
consultancies globally, constituting a USD $18.4 billion market. The top
five revenue generating firms were Mercer, Ernst & Young, Deloitte, Watson
Wyatt (now part of Towers Watson), Aon (now merged with
Hewitt), and PwC consulting. For 2010, HR consulting was ranked the #43 best job
in America by CNN Money. |