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Human resource management: the ultimate guide to HRM

Employees have the potential to be an organization’s most valuable asset. Although equipment, inventory, location, and intellectual property are all important, human capital is what transforms a good idea into a successful business – it’s people who make products and services both possible and profitable.

human resource management

Implementing an effective human resource management strategy can have a wide range of benefits that impact every facet of your business.

Improve employee relations, raise retention rates, inspire employee performance, and create a positive work environment by investing time and effort into talent management.

What is human resource management?

Human resource management (HRM) is the practice of hiring, training, compensating, managing, and retaining the employees of an organization. To put it more simply, HRM is people management.

Every aspect of the strategic planning, decision-making, and work involved with building and maintaining a team of employees is part of personnel management.

Learn the language of human resources:

How does human resource management work?

Human resource management isn’t limited to the work of the HR department. While it’s true that HR professionals are often in charge of hiring, onboarding, managing employee benefits and compensation, overseeing company policy, and other administrative tasks, team leaders and managers also have responsibilities that can be defined as human resource management.

Employee training, professional development, performance management, and even inspiring and motivating employees, all fall under the definition of HRM.

Check out the following resources to help streamline your hiring process:

The importance of human resource management

The basics of HRM ensure that your organization has employees, but a well-developed strategy enhances the employee experience and reflects the core values of your organization.

When implemented thoroughly and thoughtfully, human resource management can increase employee engagement and improve your brand’s reputation, which also makes it easier to attract top talent.

Read more about why human resource management is important:

Objectives of human resource management

The main goal of human resource management is to fulfill staffing needs while creating and maintaining a positive work environment for employees. Additional objectives of HRM include:

  • Optimizing organizational behavior
  • Achieving organizational goals
  • Creating a positive work culture
  • Implementing training and development
  • Supporting employee empowerment
  • Improving retention
  • Complying with employment law

HRM career opportunities and requirements

HRM positions are ideal for organized, detail-oriented people who enjoy helping others and coordinating solutions to administrative and personal problems.

Examples of human resource management careers include:

Entry-level HR positions often require a bachelor’s degree, with a focus of study that relates to human resources, business, or accounting and finance for jobs that involve compensation.

An MBA or a master’s degree and certifications from the Society for Human Resource Management (SHRM) or the Human Resources Certification Institute (HRCI) can be helpful for landing leadership or management positions in HRM.

Learn more about human resource management careers:

What is the difference between HR and HRM?

How are human resources and human resource management different from one another? Human resources is part of the broader scope of human resource management, but the two terms are not synonymous.

Human resources is the department that deals with the tasks and resources associated with hiring, compensation, and administration of employees.

Human resources management is the practice of implementing principles of management to effectively organize and optimize employees of an organization.

Read more about related human resources terms:

Skills and responsibilities of an HR manager

Human resource managers oversee staffing and work with executives to make strategic decisions to create sustainable change to improve the employee experience within their organization. Skills and requirements to be an HR manager include:

  • Degree in Human Resources or related field
  • Previous experience as HR Manager or other HR Executive
  • Experience with HR systems, databases, and metrics
  • In-depth knowledge of labor law and HR best practices
  • Detail-oriented with excellent communication and interpersonal skills

The responsibilities of an HR manager may include:

  • Overseeing the talent acquisition process, from recruiting to training
  • Working with executives to align talent management to the organization’s objectives
  • Managing the daily workflow of the Human Resources department
  • Analyzing trends in compensation and benefits
  • Coordinating professional development and growth initiatives for staff
  • Handling performance reviews, disciplinary issues, and terminations
  • Ensuring compliance with local, state, and federal labor laws and regulations

Read more about HR skills:

How to become a Human Resources Manager

Starting a career as a Human Resources Manager often requires a Bachelor’s degree in Human Resources, Business Administration, or a related field and prior professional experience in a human resource management position.

HRM tools & software

Since HRM covers such a broad range of relevant positions and objectives, there is a wide variety of tools and software available to streamline the process. A Human Resources Information System (HRIS) can help make managing people, policies, and procedures more simple. HRIS solutions make it easier to record and analyze information such as applicant tracking, onboarding, payroll, and performance management.

Human Management Resource Systems (HMRS) perform similar functions to HRIS solutions, but also include features about more qualitative information about the performance and engagement of employees.

Discover additional resources to streamline HRM:

Human resource management trends

The most significant shift in recent human resource management trends involves a new emphasis on benefits and work/life balance. Offering a healthcare plan and the occasional birthday cake in the breakroom doesn’t cut it in today’s competitive job market.

Company culture and the employee experience matter more to potential applicants than 401k matches, in many cases. Consequently, organizations are staying competitive by offering perks that improve an employee’s quality of life, such as remote work opportunities, four day work weeks, flexible working hours, and generous (or unlimited) PTO.

HRM is about more than filling positions — it has evolved into creating a work environment where employees feel valued, supported, and empowered to be their best personal and professional selves.

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