In any business environment, people are difficult to manage. HR personnel is the one who manages insane and sometimes unrealistic behaviors. What does a successful business value the most? Is it the infrastructure or the employees? For sure, it’s the employees that make a business successful. Without them, any great business plan is doomed to fail.
Valuing your employees doesn’t mean giving them more salaries or relaxing their work time. You need to have a strategy to build strong relations among them, sharing their performances and managing them overall.
That’s where an HR department plays its role. If you plan to set up your business’s HR department, hop on this guide. In this article, we gather detailed information about human resource management for you.
What is HR (Human Resource)?
It seems like a two-word phrase. But the department oversees hundreds of employees. So, the human resource department is the first point of contact between an employee and the employer.
Definition: The HR department is an integral part of an organization that ensures the company’s overall culture.
Besides, it takes charge of hiring the required talent, cutting employee-related expenses, and maintaining pay scales and other benefits. On top of it, an HR manager resolves conflicts and troubleshoots problems to streamline a company’s workflow.
In a nutshell, it’s an overarching department that oversees every employee at the right place in the department. Since you got the basic HR idea, let’s dive into detail.
HR Important for a Company
Many people working in large organizations don’t feel the need to visit the HR department. Thus, they may consider it useless or even an expense to the company.
Likewise, in testing times when the economy shrinks and labor is short, managers complain that the HR department is coming in the way of productivity. Are these claims foolish? Not all. But this doesn’t mean companies don’t need HR personnel.
When starting afresh, many entrepreneurs get better at handling all employee-related operations. One time, they grapple with counting the heads in a company. As they get busy with other tasks, employee satisfaction remains unregulated.
It turns the whole success upside down. When unchecked, it tends to resort to regressive activities. A bad HR department results in a downward trend in a company’s overall progress.
Enron is a perfect example of how the 7th largest giant in the energy sector fell to bankruptcy. There can be as many reasons for the organization’s failure. But, we can’t turn our face from serious HR mismanagement.
For instance, performance incentives play an important role in driving progress. But, inflated incentives can lead to unethical practices and insane risks. As a result, the company’s culture gets disrupted.
The same happened to Enron. Only a robust HR department could save the sinking titanic. Thus, it’s time to rethink priorities regarding human resource management.
Responsibilities of an HR Manager
As you know the importance of the HR department, it’s time to find what HR has on its back. What measures does the HRM department have to take daily to add to the company’s success?
They’re responsible for the following values:
Every company drives its inspiration from a certain code of conduct. How people interact with each other speaks volumes about a business’s success. The role of the HR department is to maintain those standards of culture. Also, it helps improve its employees’ ethics, which helps the company.
As an entrepreneur, you have decided to achieve some goals. Let’s say your business plan requires you to keep your employees at work for 8 hours a day. If your employees recede from this path, they may affect the company’s overall performance and KPIs. To deter such behaviors, your HR department plays its part.
The HR manager can protect the culture by enforcing regulations like the perks and punishments that infuse good habits into the employees.
HR department maintains good relations among employees and works on employee satisfaction. It’s hard to keep every employee happy in the organization.
Every single employee has different concerns for the company. So, to streamline any disagreement and conflict, HRs troubleshoot their problems. If the employee is a good resource, HR tries its best to satisfy them.
Likewise, arguments and conflicts are common where more than one person resides. To brush off those problems, HR managers come up with innovative ideas and resolve any issues among employees.
Hiring and firing take place in every company. It is the norm of every business. Sometimes external factors like inflation and economic depression lead to lay-offs.
But in other cases, employee performance plays a role in the firing. So, the HR department takes care of sending the employees home that doesn’t work efficiently.
On the otherhand, when there is a need to hire new talent or skill base, HR conducts increases and evaluates applicants’ skills with certain metrics. That’s why this department caters to the employment needs of a company.
You may know that HR maintains the salary record of employees and ensures their presence in the office at the start of the day.
What makes the employees stay at an organization? The additional benefits lure employees to remain in the company they work for.
These perks can also encourage employees to work harder to achieve personal goals. On top of that, HR managers take care of employees’ compensations and tax benefits.
The human resource department uses out-of-the-box techniques to keep the employees attached to the company with appraisals.
How to Create an HR Department in your Startup?
As an entrepreneur, you have created a sound business. After attaining steady growth, you reach the threshold where things get out of your control. You can’t put your hands down on everything as a single person. Particularly, your growing employee base is hard to handle.
Thus, you must create a robust HR department in your company to leave most of the weight on your shoulders. It may also help you focus on other important business tasks.
Let’s find out how you can build a human resource department in your company.
First, find out which roles your employees are performing right now. Plan out your employment hierarchy and identify the posts you need to fulfill.
You may come across various employees doing more than one task. Evaluate your employees to find which jobs they can do the best.
You can hire new roles and even fire some employees if they don’t deem fit in the organization structure.
HR department comes with more costs related to a better workplace environment and culture for the employees. HR transforms your outlook toward your employees. That’s why it needs more expenses to build a code of conduct and take the conflict resolution professionally.
There are alot of things your HR will need while hiring new employees, like employee screening software and subscription to job boards.
Thus, you must take account of all the overhead costs and budget them down for proper HR functioning.
Your old payroll mechanism may not function properly with a huge team. Therefore, you must redefine your payscales, fixed salary time, other allowances, and appraisals.
Once you hire a professional HR, your department will automate all the set standards. Later, you also need not rethink your payroll mechanism because it will be a headache for your HR manager.
Your payroll may include other perks and privileges such as yearly tours, vacations, medical leaves, and fines/penalties.
As you are midway starting your HR dept, you need to collect every document related to the costs and expenses of the employees. Develop a ledger to constitute new entries and keep your sheets clean.
Your HR assistant can do everything later, but you need to give them the precursor to taking charge of the department easily.
You must enlist the code of conduct to ensure your employees’ productivity. This document of rules and regulations is the Bible for the employees.
Employees follow the rules and protocols when they resin satisfied with the company. So, you need to build strong communication channels where anyone can lodge their complaint with the company.
For instance, you can create Slack, Asana, or Skype groups to increase employee workflow and directly reach out to your HR.
Apart from that, you should also set up productivity measurement processes. As a single person, you can’t measure your employees’ productivity alone. That’s why you can take the help of employee tracking software to monitor them.
What do Employees Want from HR Leaders?
We have just passed a pandemic, where the job market showed a plummeting turnaround. It caused serious concerns for HR departments for companies as the real business environment changed.
Plus, the employees found several issues with their business work ethics. There are issues why businesses want to upgrade their human resource management for the future.
1. Employees Want More Flexible Job Options
The pandemic wreaked havoc on employment across the globe. According to BLS, nearly 11 million jobs are available in the USA. It depicts that there exists a serious shortage of labor in the US.
As seen during lockdowns, most companies went remote. Coming out of the crisis, people still find companies with flexible options.
According to Harvard Business Review, 88% of respondents say they want a job with flexible options irrespective of timing and place.
It states that people will even turn down lucrative opportunities for peace of mind and work-life balance. Companies must develop the best options for employees to meet the upcoming requirements.
2. Companies with new Standards of Productivity
Over the years, companies are laser-focused on productive work. But, recent times have shown that the old ways to measure productivity are flawed. You can’t measure productivity with the hours spent in the office. HR leaders have been monitoring this for years.
A recent study done by HBR shows that employees are looking for a different metric to check their work efficiency.
That’s why they prefer an environment where their work gets measured based on the outcomes they produce. Instead of hours spent and volume of work done, employers have to install new apparatus to measure productivity.
Though it’s still a long way to reach the demands of employees, companies must accede to them with time.
3. Employees Take their Health Seriously
The looming concerns of health affect the job priorities of employees. After all, they recognize the importance of well-being over work. Thus, they prefer their companies to care for their mental and physical health.
In case of any mishap, a typical employee demands their company compensate for the medical and physical losses. After knowing these concerns, businesses are adding the health factor into people’s work routines.
Around two-thirds of UK, businesses said they are responsible for their employees’ mental and physical health. Still, companies worldwide should bring new business models based on health.
The human resource department is the backbone of a company’s success. You can’t find any direct relation between a company’s progress with HR.
But, everything lies within proper monitoring and managing of employees to focus them on the right path. This article enlisted some nuggets of gold regarding HR.
Once you know these ins and outs of human resource management, you can easily set up your HR department.