1.1 Human Resource Management

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Every organization, large or small, uses a variety of capital to make the business work. Capital includes cash, valuables, or goods used to generate income for a business. For example, a retail store uses registers and inventory, while a consulting firm may have proprietary software or buildings. No matter the industry, all companies have one thing in common: they must view people as human capital. This will be the focus throughout the text as human capital is defined as  achieving organizational effectiveness through the use of people’s skills, education, knowledge, expertise and abilities.

What Is Human Resources Management?

Human resources exists within organizations who are a group of people who have been given specific roles and responsibilities, who work together to successfully achieve the goals of the organization.

Human Resource Management (HRM) is an integrated set of processes, practices, programs, and systems in an organization that focuses on the effective deployment and development of its employees. These processes include employing people, training them, compensating them, developing policies relating to them, and developing strategies to retain them. It is, by most accounts, one of the most critical functions of an organization, because for an organization to be efficient, it needs employees and systems that support them. Simply stated, HRM is all about managing people. Human resources professionals ensure the right people are hired, trained and perform to customer and company standards. Also, they are responsible for managing the employees to ensure achievement of the organizational goals, or the motivating force that guides employees to success.

Think!

Think of an organization that you admire (you can use Fortune’s ranking of the World’s Most Admired companies and Canada’s Top 100 employers, an annual ranking). If you look closely at these companies, you’ll find that they are all built, without exception, around efficient, strong, and innovative HR processes.

Strategic Plans 

A strategic plan is the organization’s plan to align its internal strengths and weaknesses with its external opportunities and threats.  Some companies perform this through a SWOT Analysis which is a planning tool and assessment of strengths, weaknesses, opportunities and threats (Kenton, 2022). The SWOT Analysis helps the company find facts and data within its industry.  Once completed, the organization is armed with information to develop the strategic plan.  From here, the company can “take action.” Often the terms vision, mission, objectives and goals are used in referencing the strategic plan. Finally, the plan needs to be managed. This is called strategic management. The plan is executed through its strengths to achieve success.

Human resources professionals can play an important role in the strategic plan. They may facilitate the process, be involved the in external and internal research, and/or manage the strategic plan as it relates to its people.

HRM as an Integrated Set of Processes

HRM relies upon a sophisticated set of integrated process to help the organization manage human capital. The effectiveness of HRM lies in how well integrated these processes are and how well aligned they are with the mission and strategy of the organization. For example, a new policy on workplace safety protocols will only be effective if employees are trained to understand and respect it. In addition, that policy has little chance of taking hold if it is not part of the performance appraisal process. Finally, in a unionized environment, any policy will have to be designed with the cooperation of the labour union so that it is integrated into the collective agreement.


Human Resource Management: An Introduction” from Human Resources Management – 2nd Ontario Edition by Elizabeth Cameron is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.

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Human Resources Management Copyright © 2023 by Debra Patterson; Elizabeth Cameron; Stéphane Brutus; and Nora Baronian is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, except where otherwise noted.

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